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* Sukuk bolsters capital adequacy to 20 pct - CEO on TV
* $250 mln offering prices at 6.75 pct - leads
* May need further capital measures in 2018 - CEO on TV
(Adds detail, CEO comments)
LONDON/DUBAI, May 10 (Reuters) - Kuwait's Boubyan Bank
More than a dozen Gulf banks have announced capital raising plans to meet local regulatory requirements, which in some cases are above levels set by the Basel III banking accord, and to top up reserves after years of lending growth.
Boubyan's sukuk, structured with a perpetual tenor and with an option for the bank to redeem the paper after the fifth year, priced at 6.75 percent, according to the document.
The deal, which will enhance the bank's Tier 1, or core, capital, received orders from local and international investors worth $1.3 billion, Chief Executive Adel Abdul Wahab al-Majed was quoted as saying in a statement from the bank.
He was later quoted on Arabiya TV as saying the issue would boost the bank's capital adequacy to 20 percent from 11 percent now. The capital adequacy ratio, a key indicator of a bank's health, is a combination of Tier 1 and Tier 2 capital.
Majed said the issue would cover the bank's capital needs for the next two years, with consideration to be given during 2018 on whether to sell a new sukuk or undertake another form of capital increase.
The sharia-compliant lender, a subsidiary of National Bank of Kuwait
Abu Dhabi Islamic Bank, Ajman Bank and Noor Bank joined the transaction at the end as co-managers, the document from lead managers said.
(Reporting by Sudip Roy and Hadeel Al Sayegh; writing by David French and Tom Arnold; editing by David Clarke) ((davidj.french@thomsonreuters.com; +971 4 362 5864; Reuters Messaging: davidj.french.thomsonreuters.com@reuters.net))
Keywords: BOUBYAN BANK SUKUK/
* $250 mln offering prices at 6.75 pct - leads
* May need further capital measures in 2018 - CEO on TV
(Adds detail, CEO comments)
LONDON/DUBAI, May 10 (Reuters) - Kuwait's Boubyan Bank
More than a dozen Gulf banks have announced capital raising plans to meet local regulatory requirements, which in some cases are above levels set by the Basel III banking accord, and to top up reserves after years of lending growth.
Boubyan's sukuk, structured with a perpetual tenor and with an option for the bank to redeem the paper after the fifth year, priced at 6.75 percent, according to the document.
The deal, which will enhance the bank's Tier 1, or core, capital, received orders from local and international investors worth $1.3 billion, Chief Executive Adel Abdul Wahab al-Majed was quoted as saying in a statement from the bank.
He was later quoted on Arabiya TV as saying the issue would boost the bank's capital adequacy to 20 percent from 11 percent now. The capital adequacy ratio, a key indicator of a bank's health, is a combination of Tier 1 and Tier 2 capital.
Majed said the issue would cover the bank's capital needs for the next two years, with consideration to be given during 2018 on whether to sell a new sukuk or undertake another form of capital increase.
The sharia-compliant lender, a subsidiary of National Bank of Kuwait
Abu Dhabi Islamic Bank, Ajman Bank and Noor Bank joined the transaction at the end as co-managers, the document from lead managers said.
(Reporting by Sudip Roy and Hadeel Al Sayegh; writing by David French and Tom Arnold; editing by David Clarke) ((davidj.french@thomsonreuters.com; +971 4 362 5864; Reuters Messaging: davidj.french.thomsonreuters.com@reuters.net))
Keywords: BOUBYAN BANK SUKUK/
