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Abu Dhabi and the Central Bank of the UAE on 16 March agreed to refinance $20bn in debt extended to the Dubai government in the aftermath of Dubai’s 2009 real estate and financing crisis. The rollover of the debt, which was due this year, will help to reassure investors as the Dubai economy continues to rally.
The Abu Dhabi Department of Finance and the central bank will refinance a $10bn loan to the Dubai government made by the government of Abu Dhabi ($9bn) and two Abu Dhabi state-owned banks ($1bn), while the central bank has agreed to re-discount $10bn worth of bonds issued by the Dubai government. The debt is being rolled for five years renewable at a fixed interest rate of 1%, official news agency WAM says. The bonds and loan, which can be renewed at maturity in 2019, were initially issued at an interest rate of 4% (MEES, 2 March 2009). (CONTINUED - 382 WORDS)