Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
UAE banks have raised $11 billion in US dollar debt issuance so far this year, according to Fitch Ratings. This represents one of the largest contributions in the region after Saudi Arabia and reflects the country’s strategy of using capital markets to refinance and diversify funding.
Excluding certificates of deposit (CDs), issuance by UAE banks has mainly centred on senior unsecured debt, driven by refinancing needs and a push to broaden investor bases, particularly through ESG bonds, sukuk and Formosa market transactions. Fitch noted that UAE banks have issued around $3.5 billion in floating-rate notes in the Taiwanese market alone.
By the end of 2025, UAE bank issuance is expected to remain strong, supported by solid liquidity and a robust net foreign asset position. The sector’s activity is focused more on long-term refinancing and diversification, rather than short-term liquidity pressures.
Across the Gulf Cooperation Council (GCC), banks are set for a record year of issuance. Total US dollar debt issuance is expected to exceed $60 billion in 2025, with around $40 billion excluding CDs, Fitch said.
So far this year, GCC banks have already issued nearly $55 billion, far surpassing both the 2024 total of $36 billion and the $23 billion of maturities scheduled for 2025. Excluding CDs, issuance has reached $36 billion, surpassing Fitch expectations at the start of the year.
Saudi banks have led the activity with $28.3 billion raised, followed by UAE banks with $11 billion, Qatari banks with $8 billion and Kuwaiti banks with $7 billion. Short-term CDs have surged to $18 billion this year (versus $3 billion in 2024), with almost 70% issued by Saudi banks to access cheaper international funding.
Sukuk continues to play a significant role, accounting for nearly half of new issuance excluding CDs. Subordinated debt issuance has also hit a record $14.5 billion, mainly from Saudi banks tapping Tier 2 markets to support Vision 2030-related financing and anticipate tighter capital regulation.
Fitch projects continued strong GCC issuance into 2026, supported by further US Federal Reserve rate cuts, $36 billion of upcoming maturities, strong credit growth in Saudi Arabia and the UAE, and tight liquidity in Saudi Arabia
