| ABU DHABI, Sept 18
ABU DHABI, Sept 18 National Bank of Abu Dhabi
has postponed the region's first ever green bond after
investors considered the pricing unattractive, banking sources
told Reuters on Sunday.
Green bonds have become an increasingly popular source of
borrowing for banks in emerging markets, including in India and
China in view of the growing demand for funds for renewable
The United Arab Emirates-based lender launched investor
roadshows in late August to market the benchmark-sized bond, the
first green bond ever from a Middle Eastern borrower, with the
proceeds due to be used to invest in renewable energy projects.
Benchmark size is traditionally understood to be worth
upwards of $500 million.
"Investor appetite was low and the pricing was not
attractive," a banker familiar with the matter said.
"It is being re-evaluated," he added.
A spokesman for NBAD declined to comment.
A separate banker said investors were unsure how to price
the bond given that NBAD is in the midst of a merger with fellow
Abu Dhabi lender First Gulf Bank.
The tie-up, which was recommended by the boards of the two
lenders in July, will create one of the largest banks by assets
in the Middle East and Africa. It is expected to be completed in
the first quarter of 2017.
"The market has been tested, it (the bond) may be
re-launched after the merger," the second source said.
The planned green bond would have bolstered renewables, a
sector that is gaining prominence in the oil-rich Gulf countries
as they seek to bolster their energy production and retain
hydrocarbons to sell for export.
In July, Bank of China sold a $3 billion multi-currency
green bond, while India's Axis Bank sold a $500 million,
five-year green bond in May.
(Reporting By Stanley Carvalho & Tom Arnold, editing by David
French and Susan Fenton)