By Staff Reporter
KARACHI: Dubai Islamic Bank PJSC (DIB), the largest lender in the United Arab Emirates, has finalized a $1 billion syndicated term finance facility with the Government of Pakistan, a deal signaling fresh confidence in the country’s economic rebound and boosting the global reach of Shariah-compliant funding.
The five-year facility, arranged with a consortium of regional and international financial institutions, carries a partial guarantee from the Asian Development Bank (ADB) through a Policy-Based Guarantee (PBG), the first such transaction by the ADB in Pakistan, highlighting a fresh vote of trust in the nation’s fiscal turnaround.
The deal leans heavily on Shariah-compliant financing, with about 89% of the total facility structured as an AAOIFI-compliant Commodity Murabaha. This Islamic tranche reflects surging demand for faith-based funding solutions and aligns with Pakistan’s push to expand its Islamic finance footprint.
DIB took the lead as the sole Islamic global coordinator, teaming up with Standard Chartered Plc as joint mandated lead arranger and bookrunner. Other heavyweights in the consortium include Abu Dhabi Islamic Bank, Ajman Bank, and Sharjah Islamic Bank, all prominent players in the region’s Islamic banking scene.
Pakistan’s Minister of Finance, Muhammad Aurangzeb, hailed the deal as a turning point. “This landmark financing arrangement not only underscores the strong confidence of regional and international financial institutions in Pakistan’s economic reform trajectory, but also marks an important step in expanding our access to innovative and Shariah-compliant funding solutions,” Aurangzeb said.
For DIB, the transaction is a showcase of its prowess in Islamic finance. “This transaction marks a key milestone in demonstrating how Sharia-compliant financing can be scaled effectively to meet sovereign objectives while upholding partnership and prudence,” said Dr. Adnan Chilwan, Group Chief Executive Officer of DIB.
“DIB is delighted to have reintroduced Pakistan’s credit to the Islamic term financing market after a hiatus of over two years through an innovative structure. We are confident this will pave the way for the government to access broader pools of Sharia-compliant liquidity in the near future.”
The ADB’s Policy-Based Guarantee was a linchpin in the deal, smoothing Pakistan’s re-entry into the international commercial market and signaling faith in its ongoing fiscal reforms and macroeconomic resilience, according to the Islamic bank’s statement.
The transaction also marks Pakistan’s return to Middle East capital markets after more than two years, a move the bank described as “a strategic re-engagement” that reflects growing investor trust and a renewed appetite for collaboration through ethical and cost-effective financing solutions.
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