DUBAI - Majid Al Futtaim (MAF) and Banque Saudi Fransi plan to price Islamic bonds, or sukuk, on Tuesday, as investor demand and favourable conditions drive issues from the Gulf region.

Emirati retail conglomerate MAF launched a $500 million 10-year green sukuk at 140 basis points (bps) over Treasuries, capital markets publication IFR reported, tighter than earlier guidance, after order books hit more than $3 billion.

Dubai-based MAF, a leading family-owned business group with assets of $18 billion at the end of 2022, said on Monday it had mandated banks ahead of a sale.

Saudi lender Banque Saudi Fransi is also expected to price a five-year sukuk on Tuesday after it said it had mandated banks to arrange investor calls ahead of a possible issue under its $4 billion trust certificate issuance programme.

IFR reported early price guidance for the benchmark-sized sukuk issue at 130 bps over Treasuries. A benchmark issue is typically at least $500 million.

There has been a pick-up in Islamic debt issuance from the Gulf recently as borrowers look to tap a broader investor base and meet demand for an under-supplied asset class.

(Reporting by Rachna Uppal; Editing by Alexander Smith)