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With oil prices 60% down on their 2014 peak, GCC member countries are increasingly turning to borrowing to make up for their revenue loss. Bahrain and Qatar are now launching new bonds, and Oman is considering following suit, all three following Saudi Arabia’s lead in July to resort to bonds.
Bahrain’s $1.5bn two-tranche sovereign bond, launched last month, was 1.6 times oversubscribed, Bank ABC, one of the joint lead managers arranging the issue, has announced. The first tranche for $700mn carries a yield of 5.875% with a five-year maturity due on 26 January 2021, while the second one for $800mn has a yield of 7% with a 10-year maturity due on 26 January 2026. Despite difficult market conditions and low oil prices, the bond drew a strong and diversified order book across the region and internationally. Bank ABC says the deal performed well in the secondary market. Other lead managers were BNP Paribas, Citigroup, HSBC and JP Morgan.
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