A&O scores instruction for first-ever LSE sukuk listing

Allen & Overy (A&O) has bagged a lead role advising on the first sukuk programme to be listed on the London Stock Exchange (LSE).

A&O advised HSBC Bank as arranger in the establishment of a $5bn (£256.17m) Islamic sukuk programme. This is its first issue under the programme and is valued at $800m (£407.06m). This is the first sukuk programme in the United Arab Emirates (UAE) and also the first programme to be listed on the LSE.

The programme was established by Abu Dhabi Islamic Bank PJSC (ADIB), which was advised by Norton Rose. The team was led by Dubai-based partner Tahir Ahmed.

HSBC was advised by partner Roger Wedderburn-Day, with assistance from senior associate Anzal Mohammed.

Wedderburn-Day said: “The UAE market has really taken off in the past 18 months and banks are increasingly coming to the market. The programme is a framework that will enable the bank to make further issues.”

The sukuk programme is structured to allow both senior and subordinated sukuk issuance, which in effect allows the subordinated sukuk issue to be treated as part of ADIB’s regulatory capital.

Wedderburn-Day added: “This provides the banks with a new source of regulatory capital. At the moment the only way Islamic banks can raise capital is by share issues. This provides the bank with greater flexibility as it will have the ability to raise subordinated debt capital. This is of great value.”

Maples & Calder advised the issuer, the Cayman Islands entity ADIB Sukuk Company. The team was led by Islamic finance partner Tahir Jawed.