DOHA: The issuance of debt securities picked up in Qatar during the past six months to reach $4.7bn. Of the total $30.1bn worth of debt securities issued in the GCC during the first half of 2013, Qatar, UAE and Saudi Arabia together accounted for 82 percent of the issuance, NBK’s ‘Economic Update’ noted yesterday.
The stock of GCC bonds, both conventional and Sukuk, increased during the first six months of the year. Private sector issuance maintained a strong pace, dominating the GCC’s fixed income activity. Activity was driven by the non-financial sector.
The stock of outstanding GCC fixed income instruments rose to $239.8bn at the end of 1H13.
The balance of outstanding bonds was up $19.2bn thus far in 2013 and 15.3 percent against a year ago. The largest debtors are the Qatari public sector (23 percent), the UAE financial sector (16 percent) and the UAE public sector (15 percent).
Among non-financial private issuers, the Saudi sector is the most active with 10 percent of all outstanding GCC debt followed closely by the UAE.
The non-financial sector (NFS) saw issuance increase threefold in 1H13, jumping $6.7bn to $10.1bn, its highest level ever. Coupled with issuance by the financial sector, the private sector experienced its strongest half yet, with gross issuance totalling $19bn.
In the UAE, most of the new debt was issued by financial institutions ($9.3bn) and coincided with a recovering private sector and increased confidence. Saudi Arabia’s issuance activity was dominated by the non-financial sector, which was also the largest issuer in the region during the first six months of the year. The private sector has been increasingly outperforming the public sector over the last 12 months. Its stock of fixed income debt has grown by 25 percent since last June, while outstanding public sector debt only saw an increase of 7 percent over the same period.
Its share of total new issues has also increased to 63 percent in the first half of this year, well above the 30 per cent average observed for the first halves of the years from 2009 until 2012.
The average maturity of outstanding GCC debt securities remained steady at 5.8 years at the end of the first half of 2013. The public and financial sector converged to an average maturity of five years, while the non-financial sector saw a healthy jump of 0.6 years to 8.4 years in 1H13, said NBK. The Peninsula
