Bahrain’s sukuk and bond order book hits $7.8bn

Reuters/Naseem Zeitoon

Bahrain has tightened guidance for its US dollar-denominated sukuk (Islamic bonds) and conventional bonds after it received combined orders of over $7.8 billion for the debt sale.

Guidance was tightened to around 6.5 percent for the seven-year sukuk and 7.75-7.875 percent for the 12-year notes, Reuters reported, citing the document from one of the arranging banks said. 

Initial guidance was about 6.875 percent for the sukuk and around eight percent for the conventional paper.

In November 2022 S&P Global Ratings revised its outlook on Bahrain to ‘positive’ from ‘stable’ and affirmed its ‘B+/B’ long- and short-term foreign and local currency sovereign credit ratings. 

The upgrade was driven by the expectation that the government will continue implementing fiscal reforms to reduce the budget deficit that will place debt-to-GDP on a more sustainable path.

Last month Bahrain announced that its GDP grew by 4.9 percent in 2022, the fastest rate since 2013.

Non-oil real GDP increased by 6.2 percent in 2022, the highest rate since 2012 and above the five percent target in Manama’s economic recovery plan, according to the latest Ministry of Finance and National Economy figures.

The GCC country also this week launched a ‘golden licence’, providing incentives to foreign and local companies with large-scale investment projects in the country, aiming to propel investments and boost job creation.