Abu Dhabi (Al Ittihad)
The first auction of 2023 for the issuance of treasury bonds (T-Bonds) denominated in UAE dirhams witnessed a strong demand by the six main distributor banks, receiving bids worth 6.85 billion dirhams, exceeding the volume of the subscription by 6.2 times, and the auction value reached 1.1 billion dirhams.
The UAE, represented by the Ministry of Finance in its capacity as the issuer and in cooperation with the UAE Central Bank in its capacity as the issuance and payment agent, announced the results of the first auction for the year 2023 for the issuance of treasury bonds (T-Bonds) denominated in UAE dirhams, as part of the treasury bond issuance program for the year 2023. He posted it in the Treasury Calendar earlier this year.
The auction achieved strong demand for the two tranches, and the final allocation of two-year bonds amounted to 550 million dirhams, and 5-year bonds amounted to 550 million dirhams, with a total of 1.1 billion dirhams for issuance in the first auction for the year 2023. The success achieved by the auction is reflected in the premium prices driven by the market, which It was achieved by a difference of 10 basis points for two years, and a difference of 15 basis points for a period of 5 years, according to the applicable US Treasury bond measure.
Reissues were practiced in this auction to build up the volume of individual bond issues, with the aim of improving liquidity in the secondary market.
It should be noted that treasury bonds in the local currency work to build a yield curve denominated in the UAE dirham, which contributes to enhancing the competitiveness of the local debt capital market, improving the investment environment, and providing safe investment alternatives to investors, as well as supporting the sustainability of economic growth. And the Ministry of Finance had issued, in 2022, accumulated treasury bonds worth 9 billion dirhams over periods ranging between two, three and five years.
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