The UAE Ministry of Finance (MoF) announced on Saturday that the second auction of federal treasury bonds (T-Bonds) will take place on Monday, June 20th.
The auction size would be AED 1.5 billion ($408 million), divided into two tranches: a two-year tranche worth AED 750 million and a three-year tranche worth AED750 million ($204 million).
Treasury bonds (T-bonds) are federal government debt securities with maturities of more than 20 years issued by the federal government.
The re-opening of bonds will be used in this auction to increase the volume of individual bonds issued in order to improve secondary market liquidity.
The first auction of UAE treasury bonds received bids worth Dh9.4 billion and was oversubscribed 6.3 times, according to the finance ministry.
His Highness Sheikh Mansour bin Zayed Al Nahyan, Deputy Prime Minister, Minister of Presidential Affairs, and Chairman of the Board of Directors of the Central Bank of the UAE, stated that the success of the first auction of Federal T-bonds and the strong demand for them, which saw a 6.3-fold oversubscription, is an important milestone.
The ministry announced on Saturday that it plans to issue six treasury bond tranches totaling Dh9 billion in 2022. Other tranches will be issued at various times throughout the year with varying tenures of up to five years. Ten-year tranches would be issued in the future.
The UAE will proceed with its plan to issue local bonds in 2022 through additional periodic auctions. The conventional T-bonds will be denominated in UAE dirhams in order to expand the local bonds debt market, with the primary goal of developing the mid-term filed curve, with tranches of two and three years, and in principle, five years, while ten-year tranches will be issued later.