UAE’s UNB in talks with banks over bond issue: sources

Talks are underway between Abu Dhabi-listed Union National Bank (UNB) and other banks over issuing a potential benchmark-sized bond, Reuters reported on Tuesday, citing three unnamed sources with knowledge of the matter.

The size of UNB's issue is not yet clear, but it will likely be benchmark-sized, said the sources. A benchmark-sized bond is usually considered to be at least $500 million. The issue would be conducted under the bank’s $3 billion bond program.

UNB is said to be finalizing the list of arranging banks for its latest issue, which will most likely take place during the third quarter.

One of the sources added that the bank saw an opportunity to tap the bond market at a time when regional borrowing costs remain relatively low.

The company’s chief executive Mohammad Nasr Abdeen said in February that the bank could turn to the bond market in 2016 to help support its deposit levels.

UNB is 50 percent owned by Abu Dhabi’s government, and is also the emirate’s fifth-largest lender by assets.

Banks in the Gulf have continued to raise cash this year amid tighter liquidity and lower oil prices.