UAE entities explore green finance prospects

Reuters/Satish Kumar

An Abu Dhabi sovereign fund and Dubai’s largest listed bank are working on promoting and exploring green finance as part of their commitment to a sustainable future.

Emirates NBD Bank, Dubai’s largest lender, intends to raise $750 million from its first five-year green bonds.

The spread for the debt sale has been set at 120 basis points (bps) over US Treasuries, tighter than guidance of 140 bps over the same benchmark released earlier in the day after orders topped $1.90 billion, Reuters reported, citing a bank document.

• Taqa lists $1.5bn green bonds on Abu Dhabi exchange
• Emirates NBD to expand sustainable finance offering
• Egypt to issue new bonds to meet 2050 sustainable goals

The USD-denominated senior unsecured bond will be issued under its $20 billion Euro medium-term note programme. 

Last month, the bank launched a sustainable finance framework setting out its plan to expand its involvement in this area across all divisions in both its regional and international markets. 

“The new framework allows for the issuance of green and sustainable debt instruments to finance projects that enable the transition to a low carbon and climate-resilient economy,” Emirates NBD said. 

Meanwhile, Abu Dhabi sovereign wealth fund Mubadala Investment Company has hired banks to hold investor meetings to introduce its newly established green finance framework.

Through its unit Mamoura Diversified Global Holding, Mubadala has mandated Abu Dhabi Commercial Bank, First Abu Dhabi Bank, HSBC and ING to present the framework to investors, Reuters said quoting fixed-income news service IFR.

The investor meetings will be held from October 4 to 6. 

A report published by Standard Chartered in April last year concluded that the UAE alone would require $681 billion of investment to finance its transition to a net zero economy, thereby creating a huge business opportunity for local financial institutions.  

The Cop28 climate change conference, hosted by the UAE from November 30 until December 12, is expected to significantly boost interest in green sukuk in the sector’s core markets of the GCC, Malaysia and Turkey.