Linklaters advises on the first digitally native notes issuance in the Middle East
Linklaters advised First Abu Dhabi Bank PJSC on the successful offering of US$100m Floating Rate digitally native notes (DNNs) due 2028 under its US$20bn Euro Medium Term Note Programme. The transaction represents the first digitally native notes issuance in the Middle East region.
The three-year US dollar denominated Floating Rate DNNs were issued in dematerialised registered form and cleared through the Central Moneymarkets Unit (CMU) of the Hong Kong Monetary Authority which has a bridge into Euroclear and Clearstream as international CSDs. The creation process of the DNNs utilises, and the beneficial interests in the DNNs are recorded using, HSBC Orion*.
The DNNs have a sole listing on the Abu Dhabi Securities Exchange (ADX).
The Linklaters’ team was led by capital markets partners Jonathan Fried, based in Dubai and Hanwen Yu and Gloria Cheung, based in Hong Kong SAR, with support from counsel Grace Wee, managing associate Sian Sanford and associate Declan McGrath.
Linklaters’ partner and head of Middle East capital markets Jonathan Fried commented:
“It has been a privilege to support First Abu Dhabi Bank on this first digital bond transaction in the Middle East. This likely signals the beginning of a new stage in the evolution of the public debt markets in the Middle East and will be of great interest to a range of market participants going forward.”
Linklaters is at the forefront of the evolving digital innovation space. The team regularly advises on path-breaking digital assets transactions, including advising on the Hong Kong SAR Government’s first multi-currency digital green bond offering – the first digitally native bond issuance in Hong Kong, and the Grand Duchy of Luxembourg on its first digital treasury certificates issued on blockchain.
*HSBC Orion refers to the distributed ledger technology (DLT) platform deployed by HSBC to CMU as the DLT platform operator for the purposes of, among other things, creating and settling the DNNs.
