Bond issuances are surging globally, and the Middle East is joining the rush ahead of Donald Trump’s inauguration on 20 January.
Regional bankers tell us that they see activity increasing in the UAE, Saudi Arabia, and Turkey.
Dubai’s biggest lender, Emirates NBD, will head to the bond markets today, a Middle Eastern debt capital markets banker tells MONIIFY on condition of anonymity. The bank will issue a five-year senior unsecured dollar-denominated Formosa bond, he says. Such notes are issued in Taiwan but are not denominated in the Taiwanese dollar.
Over in Turkey, the official credit agency of the country, Turk Eximbank, is planning to raise up to $5 billion in bond sales overseas, another DCM banker tells us on condition of anonymity.
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Other recent regional highlights include Kuwait Finance House’s $1 billion bond sale, Aldar Properties tapping banks to sell dollar-denominated debt, and Isbank, Turkey’s first private bank, launching its inaugural additional tier-1 subordinated debt issuance.
The numbers don’t lie: $12 billion in bonds have already been issued in the Middle East this year, nearly matching all of January 2024 in just one week, LSEG data shows.
Why? Companies are scrambling to raise cash before the incoming administration in Washington, DC kicks off a promised trade war that could throw financial markets into chaos.
The Trump effect
It’s the Trump effect, plain and simple. His plans to slap tariffs on just about everyone, not to mention his outlandish ideas like buying Greenland and annexing Canada (yes, really), have left markets bracing for inflation.
And inflation means one thing: the US Federal Reserve will opt for higher interest rates.
If US government bonds start paying more interest, corporate issuers will have to offer juicier premiums to attract buyers. And so, companies want to move now, and lock in cheaper borrowing costs before the Fed potentially halts a rate-cutting spree.
The first source says that “the worry surrounding Trump’s proposed tariffs is real,” while the second source says the rush wasn’t this frantic last year.
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He says that this rush is a reaction to fears about rising funding costs based on “the market’s belief that Trump’s policies could be inflationary.”
And it’s not just the corporates. Saudi Arabia kicked off 2025 with a borrowing bonanza, raising $12 billion in bond sales, while its sovereign wealth fund, the Public Investment Fund, also raised a $7 billion Islamic loan.
Equities coming
Debt isn’t the only action heating up. According to Goldman Sachs trader Rich Privorotsky, equities are next.
He expects equity capital markets to ramp up with secondary issuances soon, as early as next week, as companies look to get ahead of Trump-fueled volatility.
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As we’ve discussed, market turbulence tends to spike between mid-January and February. Trump’s continuing rhetoric can only make it worse.
Edited by Ankush Chibber and Thyagu Adinarayan. If you have any tips, ideas or feedback, please get in touch: talk-to-us@moniify.com
