The UAE’s Ministry of Finance (MoF), in collaboration with the Central Bank of the UAE (CBUAE), has completed the successful June 2025 auction of Islamic Treasury Sukuk (T-Sukuk), denominated in UAE dirhams and valued at AED1.1 billion. This auction is part of the 2025 T-Sukuk issuance programme published on the MoF’s official portal.
Oversubscribed 5.6 Times Amid Strong Market Confidence
The auction drew significant interest from eight primary dealers, covering two tranches set to mature in May 2027 and August 2028. Collectively, the bids received totalled AED6.21 billion, demonstrating a 5.6x oversubscription rate. This level of demand highlights the strong investor confidence in the UAE’s credit standing and its robust Islamic finance framework.
Yields Remain Competitive Against Global Benchmarks
The auction results reflected market-driven pricing:
- Yield to Maturity (YTM) for the May 2027 tranche: 3.88%
- YTM for the August 2028 tranche: 3.83%
Both tranches recorded a tight spread of 2 basis points over comparable US Treasuries, indicating strong pricing performance and efficient market execution.
Strategic Role in Developing the Local Debt Market
The T-Sukuk programme plays a key role in:
- Supporting the dirham-denominated yield curve
- Offering secure Sharia-compliant instruments to a diverse investor base
- Strengthening the UAE’s local debt capital market
- Contributing to long-term economic growth and financial sustainability
This successful auction underscores the UAE’s commitment to developing its Islamic financial ecosystem and enhancing its position as a global hub for Sharia-compliant investment tools.
