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(Bloomberg) –
Bahrain plans to return to the dollar bond market, according to others close to the issue, as the country faces one of the world’s biggest budget deficits this year.
The Gulf country sent a request for proposals to banks seeking to propose a question of reference size, others said, asking not to be known because the discussions are private.The benchmark means at least the equivalent of $500 million.
The sale would possibly come with an aggregate of traditional bonds and Islamic securities known as sukuk, other people said.
If the kingdom pursued the plan, then it would Abu Dhabi, the capital of the United Arab Emirates, which raised $ 5 billion in a three-part offering last week.
Bahrain is under fiscal pressure despite a $10 billion bailout promised through its wealthiest neighbors in 2018.Bahrain, the smallest of the six members of the Gulf Cooperation Council, is on track to collect a deficit that International Monetary Fund projects will be 10th in the world this year with 15.7% of gross domestic product.
In May, the government sold $2 billion in 10-year notes and Islamic securities to 4.5 years, the country with the lowest rating on selling dollar bonds since the covid-19 pandemic’s market breakup.
Yields on Bahrain’s $1 billion bonds due in 2030 fell to the lowest point this month since its value in May.Dubai-based Arqaam Capital said it could raise up to $1 billion at this time of year.
(Updates from the Abu Dhabi sale in the fourth paragraph)
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