Dubai, UAE: Mashreq, one of the leading financial institutions in the MENA region, and rated A3 (Moody’s), A (S&P) and A (Fitch), all with a stable outlook, successfully priced a US$500mn Additional Tier 1 bond offering with a coupon of 6.25 percent per annum on Thursday 12th February 2026.
Mashreq decided to capitalize on favorable market conditions and to support its market leading growth trajectory with a new AT1 issuance. The transaction was launched ahead of the Asian Lunar year break, the start of the holy month of Ramadan and expected competing supply from UAE banks, lined up to issue capital securities to replace their existing ones. The issuance further strengthens Mashreq’s robust capital position and optimizes its capital structure, reinforcing the Bank’s ability to sustain its strong growth through 2026.
Following a well-attended global investor call and a couple of days of intensive marketing, Mashreq decided to open the order books on Thursday February 12th, 2026, with initial price thoughts (IPTs) of 6.75% – 6.875% for a transaction sized capped at US$500mn. Large demand early in the process allowed Mashreq to release a book update of >US$1bn, confirming significant momentum and demand from international and regional investors. Mashreq was then able to release a revised guidance, moving 37.5 bps inside of IPTs on the back of an orderbook exceeding US$1.85 bn. Despite the strong move, the orderbook held firm allowing Mashreq to launch the Perpetual Non-Call 5.5-year Additional Tier 1 bond by setting the yield at 6.25% with a reset margin of +251.6bps. The order book peaked at US$ 2.1bn at that stage. This records the tightest ever margin for Mashreq for a subordinated Additional Tier 1 or Tier 2 capital issuance.
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