Oman Arab Bank raises $400M via AT1 perpetual bonds on London Stock Exchange
What's the deal? Oman Arab BankDealroom has a profile for this one. Try Dealroom → has successfully listed $400M in Additional Tier 1 capital bonds on the London Stock Exchange. The perpetual, non-callable bonds carry a fixed-to-reset coupon of 6.75% and have a 5.5-year non-call period.
The offering drew strong investor demand, with the order book exceeding $1.1B — roughly 2.75 times the target amount. Final pricing came in at 6.75%, about 50 basis points below initial guidance, signalling robust appetite.
Why now? Oman's economy has been on solid footing, and the bank is capitalising on favourable conditions to diversify its funding sources and strengthen its global capital markets presence. Listing on the London Stock Exchange gives it access to a broader, more international investor base.
Suleiman bin Hamad Al Harthi, the bank's chief executive officer, said the issuance reflects confidence from both regional and international investors in the bank's credit fundamentals, financial flexibility, and strategic direction — as well as in the wider Omani economy.
What could go wrong? AT1 bonds sit at the riskiest end of bank capital structures. They can be written down or converted to equity if the issuer hits financial trouble, as Credit Suisse investors learned painfully in 2023. A downturn in oil prices — Oman's economic backbone — could pressure the bank's balance sheet and unsettle bondholders.
The signal: Oman Arab Bank, a mature commercial bank jointly owned by Jordan's Arab Bank plc and Omani institutional shareholders, is leveraging its cross-border parentage to tap global capital markets at increasingly competitive terms. The 50-basis-point tightening from initial guidance and a 2.75x oversubscription underscore that international investors are willing to price Gulf bank risk aggressively — even at the AT1 level — as the region's lenders move beyond traditional deposit funding to build more sophisticated capital stacks.
Read more: Oman News Agency
