Dubai: Abu Dhabi’s government said it would list its bonds on its own Securities Exchange as well as in London, in a sign of growing competition among financial centres for the region’s business.
Many Gulf governments and companies have traditionally listed their bonds in London, because of its deep market and respected legal framework. Abu Dhabi government bonds currently outstanding have been quoted on the London Stock Exchange
But the emirate’s Department of Finance (DOF) said on Thursday that it would now obtain dual listings for the bonds in Abu Dhabi, and expected the procedures to be completed soon.
“The dual listing will reinforce Abu Dhabi’s position as an international financial centre that attracts investment and provides investors with diverse options in the stock and bond markets,” DOF chairman Hamad Al Hurr Al Suwaidi said in a statement.
Gulf governments are increasingly keen to develop their financial sectors in order to diversify their economies beyond oil. Earlier this year, Abu Dhabi announced plans to establish a full-service financial zone on an island near its downtown area.
Dubai declared this year that it wants to become a top centre for issuance of Islamic bonds, and it is convincing some of its state-run companies to start listing their bonds on Dubai exchanges.
Abu Dhabi did not say on Thursday whether it would also encourage local companies to list their bonds at home. Abu Dhabi Commercial Bank and Abu Dhabi Islamic Bank currently have instruments listed in London.
The Abu Dhabi government bonds were issued in 2009 in two tranches, each worth $1.5 billion (Dh5.5 billion). The first matures in 2014 and the second in 2019.