The Ministry of Finance (MoF), acting as issuer and in coordination with the Central Bank of the UAE (CBUAE) as issuing and payment agent, has launched the first-ever 7-year tranche of UAE dirham-denominated Islamic Treasury Sukuk (T-Sukuk), valued at AED550 million ($149.7 million). The move marks the longest tenor issued under the programme so far and signals a strategic push to extend and deepen the UAE dirham yield curve.

The new tranche drew strong investor interest, attracting bids of nearly $844.1 million, almost six times the issuance size. This underscores confidence in the UAE’s economic resilience and the strength of its Islamic finance ecosystem.

The issuance formed part of the MoF’s February auction of UAE dirham-denominated Islamic Treasury Sukuk, which raised a total of $299.5 million. The offering falls under the Islamic Treasury Sukuk Programme for 2026, as outlined on the Ministry’s official platform.

The auction saw solid participation from eight primary dealers across two tranches maturing in May 2030 and February 2033. Total bids reached $1.6 billion, reflecting an overall oversubscription ratio of 5.3 times, with the 7-year tranche alone oversubscribed nearly six times. The strong demand highlights sustained investor appetite for Shariah-compliant instruments and confidence in the UAE’s credit fundamentals.

Market-driven pricing remained competitive, with a yield to maturity of 3.53% for the May 2030 tranche and 3.779% for the February 2033 tranche. Both were priced below comparable US Treasuries at the time of issuance. The Sukuk are listed on Nasdaq Dubai under the UAE Treasury Islamic Sukuk Programme, enhancing secondary market accessibility for investors.