UAE issues new law to develop federal bond market

      Published on Wednesday, 17 October , 2018      11 Views      Comments Add Comment
UAE issues new law to develop federal bond market


The UAE on Saturday issued a new law permitting the federal government to begin issuing sovereign debt.

Abu Dhabi and Dubai already sell bonds in international markets but the new legislation will enable the government to help benefit other emirates as federal bonds would carry higher credit ratings than those emirates could achieve individually.



According to state news agency WAM, banks in the UAE will be able to buy government bonds in dirhams or foreign currencies, while the central bank will use the bonds to help manage the interbank money market, and the bonds will support the creation of a secondary market in government debt.

The law will also establish a Public Debt Management Office at the finance ministry, WAM added.

The office will be responsible for proposing public debt management strategies and policies in coordination with the central bank and will monitor financial risks.

The UAE on Saturday issued a new law permitting the federal government to begin issuing sovereign debt.

Abu Dhabi and Dubai already sell bonds in international markets but the new legislation will enable the government to help benefit other emirates as federal bonds would carry higher credit ratings than those emirates could achieve individually.

According to state news agency WAM, banks in the UAE will be able to buy government bonds in dirhams or foreign currencies, while the central bank will use the bonds to help manage the interbank money market, and the bonds will support the creation of a secondary market in government debt.

The law will also establish a Public Debt Management Office at the finance ministry, WAM added.



The office will be responsible for proposing public debt management strategies and policies in coordination with the central bank and will monitor financial risks.

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Category Government | 2018/10/17 latest update at 10:10 AM
Source : Arabian Business | Photocredit : Google
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