The UAE’s Islamic finance market attracted strong investor interest on February 22, 2026, as the government’s longest‑tenor Islamic Treasury Sukuk issuance oversubscribed by a wide margin. The Ministry of Finance announced that investors placed bids totaling around AED 3.1 billion for the new seven‑year tranche, which was initially sized at AED 550 million, signaling deep confidence in the UAE’s sovereign credit and the appeal of Islamic fixed‑income instruments.
This seven‑year Sukuk, maturing in February 2033, represents the longest tenure offered so far under the UAE’s Islamic Treasury Sukuk (T‑Sukuk) programme. It forms part of a broader AED 1.1 billion sukuk auction conducted by the federal government along with the Central Bank of the UAE as issuing and paying agent. Across both tranches — the seven‑year and the shorter five‑year tranche maturing in May 2030 — total bids reached approximately AED 5.88 billion, representing an overall subscription rate of more than 5 times the amount offered.
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Analysts say this level of demand reflects both growing trust in the UAE’s debt markets and the strength of the Islamic finance ecosystem regionally. The seven‑year Sukuk was priced at a yield to maturity of 3.779 per cent, while the 2030 tranche priced at 3.53 per cent, according to the Ministry of Finance. These yields compare favorably with comparable instruments in global markets, highlighting investor confidence in the UAE’s economic and credit environment.
Islamic Sukuk — financial certificates that comply with Shariah (Islamic law) principles — have become increasingly popular among regional and international investors seeking both ethical and competitive returns. The UAE has actively promoted sukuk as part of its strategy to diversify capital markets and deepen local fixed‑income markets, which play a key role in financing infrastructure and government initiatives.
Finance experts point out that the strong reception for the long‑dated Sukuk also suggests a broader trend of growing interest in Gulf debt instruments, as investors look for yield opportunities outside traditional Western markets. With global interest rate dynamics shifting and uncertainty surrounding economic growth in other regions, the UAE’s sovereign paper is seen as a relatively stable option.
Overall, the successful oversubscription of the UAE’s longest‑tenor Islamic Treasury Sukuk underscores continued confidence in the national economy and Islamic finance markets, reinforcing the UAE’s position as a leading hub for Islamic investment products.
Source:
Khaleej Times – UAE’s Longest‑Tenor Islamic Treasury Sukuk Sees Heavy Investor Demand
https://www.khaleejtimes.com/business/finance/uaes-longest-tenor-islamic-treasury-sukuk-sees-heavy-investor-demand