Fitch Sees GCC Bank Dollar Issuance Recovering to 70 to 80 Billion Dollars in 2027
UAE banks raised their US dollar debt issuance by 43 percent year on year in the first 9 months of 2026, and Fitch Ratings expects gross dollar issuance by GCC banks to recover to 70 billion to 80 billion dollars in 2027, supported by pent-up supply and a sharp rebound in non-oil growth. On our calculation from the shares the agency gives, UAE banks issued about 18.9 billion dollars in the 9 months, already above the roughly 17.3 billion dollars they issued in the whole of 2025.
The UAE leads, Saudi issuance shifts to riyals
UAE banks’ share of GCC dollar issuance nearly doubled to 32 percent in the 9 months from 17 percent in 2025, reflecting strong senior unsecured issuance amid slightly tighter sector liquidity. UAE credit grew 18 percent year on year in the first 7 months, outpacing deposit growth of 14 percent. Saudi banks’ share fell to 37 percent from 55 percent, with their issuance down about 50 percent. The agency links that to slower domestic credit growth, slightly better domestic liquidity, capital raised early in 2025 ahead of the 1 percent countercyclical buffer that took effect in May 2026, and a shift towards riyal issuance as the sector’s net foreign liabilities reached 58 billion dollars, or 4.2 percent of assets, at the end of August. The Saudi loans-to-deposits ratio eased to 112.5 percent at end August.
GCC bank US dollar issuance
| Measure | 2025 | 9M26 |
|---|---|---|
| Gross issuance, total | $102bn | $59bn |
| Excluding certificates of deposit | Not given | $33bn |
| Additional Tier 1 and Tier 2 | $20bn | $13.1bn |
| UAE banks’ share | 17% | 32% |
| Saudi banks’ share | 55% | 37% |
9M26 is January to September 2026. Issuance excluding certificates of deposit fell 13 percent year on year.
Certificates of deposit explain most of the 2026 change
Across the GCC, dollar issuance reached about 59 billion dollars in the 9 months, against a record 102 billion dollars in full-year 2025, and the agency expects 2026 to finish about 30 percent lower. Yields on 5 year GCC bank bonds and sukuk are up 170 basis points since the Iran conflict began, mainly on US Treasury yields, which rose about 150 basis points. A 38 percent year on year fall in certificates of deposit drove the overall drop. On our calculation, certificates of deposit made up about 26 billion dollars of the 9 month total, and the 38 percent and 13 percent falls imply 9 month issuance of about 80 billion dollars in 2025, so certificates of deposit account for about 16 billion dollars of the roughly 21 billion dollar decline. A 30 percent lower year implies about 71 billion dollars for 2026, or roughly 12 billion dollars in the fourth quarter, close to the 13 billion dollars due to mature in that quarter.
Investor appetite remains strong, with recent deals oversubscribed and a stronger domestic and regional bid, particularly for Additional Tier 1 debt. Private placements made up about 20 percent of issuance excluding certificates of deposit in the 9 months, or about 6.6 billion dollars on our calculation, against about 6 percent in 2025.
What drives the 2027 recovery
The 2027 base case assumes oil averaging 70 dollars a barrel and US policy rates at 4.25 percent after a 25 basis point hike in the fourth quarter of 2026, with a more favourable geopolitical backdrop. About 32 billion dollars of GCC bank dollar debt matures in 2027, or 19 billion dollars excluding certificates of deposit. On our calculation, the 70 billion to 80 billion dollar range would be 2 percent below to 12 percent above the implied 2026 total, and 2027 maturities of 32 billion dollars equal 40 to 46 percent of that range. On our calculation, Additional Tier 1 and Tier 2 issuance of about 13.1 billion dollars in the 9 months is already about 66 percent of the 2025 total. GCC bank ratings have proved resilient, the agency said, as have first half earnings and asset quality, with liquidity healthy in the second quarter, supported by almost 80 billion dollars of deposit inflows from GCC governments and government-related entities in the first half. The exception is the Negative Outlook on Qatari banks, which mirrors the sovereign’s.
Why it matters: GCC banks have kept access to dollar markets through the disruption, with oversubscribed deals and a growing private placement channel, and UAE banks have already passed their 2025 total, on our calculation. The 2026 change is concentrated in short-term certificates of deposit and in Saudi banks’ move to local currency funding, while deposit inflows of almost 80 billion dollars from governments and government-related entities in the first half kept liquidity healthy.
Outlook: About 13 billion dollars matures in the fourth quarter and 32 billion dollars in 2027. On our reading, greater geopolitical stability and recovering credit growth are the triggers for the pent-up supply behind the projected 70 billion to 80 billion dollar 2027 range to come to market.
Sources: Fitch Ratings, The Edge.
