Middle East Business
Dubai Islamic Bank closes a 750 million dollar debut syndicated facility
By Staff Writer | 2 September 2026
A three year commodity murabaha term facility drew about 1.2 billion dollars of commitments, roughly 1.6 times the amount on offer, in the bank's first syndicated Islamic financing.
Dubai Islamic Bank has closed a 750 million dollar three year senior unsecured commodity murabaha term facility, its first syndicated Islamic financing transaction. The facility attracted about 1.2 billion dollars in total commitments, approximately 1.6 times the amount sought, and was executed at what the bank describes as competitive pricing.
The syndication was led by HSBC Bank Middle East Limited, Mizuho Bank and Standard Chartered, acting as initial mandated lead arrangers, bookrunners and coordinators. Participation came from both regional and international banks.
The successful completion of our debut syndicated Islamic financing facility marks an important milestone in DIB's funding strategy and reflects the confidence that leading regional and international institutions continue to place in our franchise.
Dr Adnan Chilwan, group chief executive officer of Dubai Islamic Bank
What the structure is
A commodity murabaha term facility is a cost plus sale arrangement rather than an interest bearing loan. The financiers buy a commodity and sell it on to the borrower at a marked up price payable over the term, which produces a fixed return without a lending rate. Senior unsecured means the facility ranks with the bank's other unsecured senior obligations and carries no security package behind it.
Dr Chilwan added that the facility diversifies the bank's funding base, deepens its relationships with banking partners across global markets and shows the reach of Shariah compliant financing within the international institutional market, and that the bank remains focused on accessing liquidity through diversified and efficient channels.
Why a bank funding line reaches a construction desk
Three year senior unsecured money at competitive pricing, oversubscribed by more than half, tells a contractor something about the cost and availability of project debt in the same market twelve months out.
A syndicated facility of this kind is wholesale funding for the bank, not project finance. It matters to anyone building in the Emirates for an indirect reason. Where an institution can raise unsecured three year money at competitive pricing and see commitments run 60 per cent past the amount offered, the appetite of regional and international banks for exposure to that market is being priced in public. That appetite is the same pool that funds the developers and the contractors those banks then lend to.
It also says something about the depth of the Shariah compliant market for larger tickets. A development financed on a murabaha or ijara structure depends on there being enough institutional liquidity behind those structures to syndicate at scale, and a debut transaction clearing at 1.6 times cover is evidence that there is.
What has not been published
The margin has not been disclosed and neither has the final allocation between participants, so competitive pricing is the bank's own characterisation rather than a published number. Nothing has been said about the intended use of the proceeds. The bank noted that the transaction was executed against a complex global market background, and the specifics of that assessment are its own. None of that is assumed here.
Regional banks have spent a decade broadening how they fund themselves. A first syndicated Islamic facility, oversubscribed and led by three international arrangers, is the point at which that broadening stops being a domestic exercise.