Emirates picks HSBC, Citi to arrange $1b sukuk

Emirates has mandated eight banks including HSBC Holdings and Standard Charteredto manage a sale of Islamic bonds, according to two people with knowledge of the transaction. The Dubai government-owned carrier also picked Citigroup, BNP Paribas, Dubai Islamic Bank, Abu Dhabi Islamic Bank PJSC and Noor Bank PJSC, said the people. The issue is scheduled for the next few weeks and will aim to raise about $1b, they said. Emirates will join a list of regional issuers seeking funding from international bond markets before expected increases in US interest rates push up borrowing costs. Issuers from the six-nation Gulf Cooperation Council, which includes the two biggest Arab economies of Saudi Arabia and the United Arab Emirates, raised a record $84.9b from bond sales last year as they sought to take advantage of low interest rates and sidestep tight liquidity in the local-loans market amid low oil prices. “Emirates always seeks diverse sources of funding, including bank finance, operating leases, Islamic financing, sukuk and bonds," Emirates said in an emailed response to questions. “We are continually engaged in discussions with various financial institutions. We will not offer comment unless a deal is formally announced as per financial market regulations.” <br/>