KIB prices first issuance of $500 million unsecured senior sukuk
Kuwait International Bank (KIB) announced the successful pricing of its first issuance of unsecured senior sukuk, valued at $500 million with a five-year maturity, as part of its $1.5 billion sukuk issuance program. The issuance represents a strategic step in diversifying funding sources and strengthening the bank’s long-term funding base, while also reflecting investor confidence in its financial strength and its presence in regional and international capital markets.
The successful issuance came amid a changing global market environment, where strong demand helped narrow the pricing spread by 30 basis points compared to initial indicative pricing, bringing the final spread to 95 basis points over the yield on five-year U.S. Treasury bonds, at an annual profit rate of 5.502 percent.
The issuance attracted strong demand from investors from its launch, with total orders reaching approximately $1.2 billion, equivalent to 2.4 times the size of the issuance, underscoring the depth of investor interest.
Commenting on the success of the issuance, Sheikh Mohammed Al-Jarrah, Chairman of KIB’s Board of Directors, said: “The success of this issuance reflects the confidence of regional and international investors in the financial strength and clear strategic direction of the KIB Group.”
He added that this issuance marks an important milestone in enhancing KIB’s presence in international capital markets and expanding its investor base, as it is the bank’s first issuance of unsecured senior sukuk under its $1.5 billion sukuk program.
The issuance received a final credit rating of ‘A’ from Fitch Ratings, consistent with the bank’s long-term rating of ‘A’ with a stable outlook.
For his part, Raed Bu-Khamseen, Vice Chairman and Chief Executive Officer of KIB, stated: “The issuance represents a strategic step in diversifying funding sources and strengthening the bank’s long-term funding base, supporting sustainable growth plans and maintaining a strong and balanced liquidity position, along with effective liability management in line with best banking practices.”
He added: “The issuance was structured using a Wakala/Murabaha framework for a five-year tenor, reflecting the growing importance of Sharia-compliant financing instruments (sukuk) among financial institutions and investors. The issuance will be settled on September 10, 2026, and the sukuk will be listed on the International Securities Market of the London Stock Exchange, with maturity on September 10, 2031.”
He praised the vital role of partners who contributed to the success of this issuance. Citigroup Global Markets Limited and Standard Chartered Bank served as Global Coordinators, while AB Capital, Bank of Bahrain and Kuwait (Bahrain Bourse), Citibank, Emirates NBD Capital, Bitex Capital, Al-Dawli Invest, Islamic Bank of Sharjah, Standard Chartered Bank, Warba Bank, Arab Bank, and QNB Capital acted as Joint Lead Managers and Bookrunners.
