DUBAI: When Abu Dhabi's biggest bank issued a $750 million bond in August, strong investor demand underlined how well most Gulf banks are riding out the global financial crisis.
The issue also sent another signal: that the region's debt market is growing strongly and, increasingly, integrating with overseas markets.
The seven-year bond from National Bank of Abu Dhabi, which attracted about $4.5 billion of orders from investors, was issued in the third week of the Muslim holy month of Ramadan.
In past years, the Gulf bond market has slowed dramatically during Ramadan, as fasting traders and investors reduce their working hours.
So the fact that NBAD's bond emerged during Ramadan this year showed how the market's expansion is changing issuance and trading patterns, analysts and traders said.
"The windows available for issuers have become much tighter and the emphasis is now on swift execution of primary deals. This shows the regional market is maturing, and adapting to global conditions," said Chavan Bhogaita, head of NBAD's markets strategy unit.
"It's largely a matter of perception - people assume that the markets in this region are closed for business during Ramadan, but that is not the case. If market fundamentals are conducive enough, deals will get done."
The bond market's growth could benefit economies in the Gulf by giving corporations a new source of funding as traditional sources languish.
Gulf bond market forges global links
