Dubai Islamic Bank Raises $1 Billion in Heavily Oversubscribed Sukuk

Dubai Islamic Bank, the UAE's largest Islamic lender, has raised $1 billion through an additional tier 1 (AT1) sukuk that attracted strong demand from regional and international investors. The transaction drew orders exceeding $2.3 billion, representing roughly 2.3 times oversubscription, and was priced with a profit rate of 6.25%. It marks the largest AT1 issuance in the Gulf since the bank's previous deal in 2024 and enabled the lender to refinance an existing $1 billion sukuk that was redeemed earlier in the year. AT1 instruments are perpetual, loss-absorbing securities that count toward a bank's core capital and typically offer higher returns to compensate investors for their subordinated, higher-risk nature. The robust demand underscores continued investor appetite for Gulf bank capital and for Shariah-compliant debt, supported by the region's solid economic backdrop and the depth of its Islamic finance market. The issuance also reflects the broader vitality of the UAE's debt capital markets, where banks and corporates have tapped both conventional and Islamic structures to strengthen balance sheets and fund growth. For Dubai Islamic Bank, the deal reinforces its capital position while signalling confidence among global investors in the strength of the UAE's banking sector.