OAB marks successful $400 million AT1 bond listing on LSE

MUSCAT, JUNE 2
Oman Arab Bank (OAB) hosted a media briefing to celebrate the successful listing of its $400 million Additional Tier 1 (AT1) bond on the London Stock Exchange (LSE), marking a significant milestone in the bank’s capital management strategy and reinforcing its position in regional and international financial markets.
The issuance was structured as a perpetual non-call 5.5-year instrument with a fixed resettable coupon of 6.75 per cent. Despite heightened geopolitical tensions and challenging conditions across global capital markets, the offering attracted strong investor demand, generating an orderbook exceeding $1.1 billion and achieving an oversubscription rate of approximately 2.75 times the targeted amount.
Sulaiman al Harthy, Chief Executive Officer of Oman Arab Bank, said the successful issuance and listing represent an important strategic milestone for the bank and reflect the confidence placed in OAB by regional and international investors.
“This was not merely a financing transaction, but a strategic step within the bank’s long-term plans to strengthen capital efficiency and reinforce its presence in international financial markets,” Al Harthy said during the briefing.
He added that the London Stock Exchange listing further enhances the bank’s standing among regional financial institutions capable of accessing global investors with credibility and confidence.
Speaking to the Observer, Al Harthy explained that the transaction’s primary impact lies in strengthening the bank’s capital base, enabling it to undertake larger financing transactions and support broader economic activity.
“When we strengthen Oman Arab Bank’s capital, it enables the bank to do bigger financing transactions. These larger transactions will have a positive impact on the economy, and that will ultimately benefit individuals and businesses,” he said.
Al Harthy added that the strengthened capital position will expand the bank’s capacity to finance larger corporate projects while allowing it to deploy capital more efficiently across different business areas, supporting future growth and profitability.
He also revealed that Omani investors accounted for around 60 per cent of participation in the issuance, while international investors represented approximately 40 per cent.
“The strong participation from local investors gave us additional confidence as we approached international markets,” he said, noting that the transaction also attracted interest from a diverse group of international investors, including banks, pension funds, family offices and investment funds.
According to the bank, the final pricing was achieved at 6.75 per cent, approximately 50 basis points tighter than the initial pricing guidance, reflecting strong investor confidence in the bank’s credit fundamentals, financial resilience, strategic direction and the strength of the Omani economy.
OAB said the transaction forms part of its long-term capital optimisation strategy and will enhance financial flexibility, broaden access to diversified funding sources and support future growth objectives, while contributing to the continued development of Oman’s financial sector.