FAB Breaks New Ground With First Gulf Blue Bond

First Abu Dhabi Bank has unveiled a pioneering five‐year Blue Bond worth HKD 390 million, marking the first such issuance by a financial institution in the Gulf. Placed via private placement and backed by an Article 9 investor, the bond signals a bold move into water‐ and marine‐related sustainable financing.

FAB's issuance aligns with its Sustainable Finance Framework 2023 and adheres to the International Capital Market Association's Green Bond Principles. The proceeds are earmarked for projects within its blue asset pool, including sustainable water infrastructure, wetland, mangrove and coral reef rehabilitation, fisheries and aquaculture management, and conservation of terrestrial and aquatic biodiversity.

This strategic initiative also dovetails with the UAE Water Agenda 2036, which focuses on advancing innovation in water management and reinforcing marine ecosystems. The timing coincides with Abu Dhabi's upcoming hosting of the International Union for Conservation of Nature Congress in October 2025 and the United Nations Water Conference in December 2026.

FAB has been supported in the transaction by Crédit Agricole Corporate and Investment Bank, which served as sole dealer. Tanguy Claquin, Global Head of Sustainability at the bank, highlighted the growing appetite among global asset managers for instruments entering the blue economy, nature and biodiversity segments.

Shargiil Bashir, FAB's Chief Sustainability Officer, described the bond issuance as a“defining milestone” that sets a precedent for sustainable finance in the region. He emphasised that directing capital towards essential water resources and marine ecosystems underscores the bank's commitment to embedding environmental stewardship into its agenda.

Observers point to a broader shift among Gulf financial institutions-from traditional oil‐based financing models to climate‐resilient frameworks. FAB's blue bond, aligned with the UAE Water Agenda 2036, reflects this trajectory and supports the bank's transition to ESG‐centred investment.

Blue bonds remain a relatively niche category globally, yet they are gaining traction as mechanisms to channel funds toward marine and water resource preservation-areas often underfinanced despite their critical ecological importance.

Beyond symbolic value, the Blue Bond may mark the emergence of a new frontier in sustainable finance for the Middle East. For ESG‐driven investors, this offers a fresh asset class combining environmental impact with financial exposure. Transparent governance under FAB's Sustainable Finance Framework and rigorous adherence to international principles may mitigate concerns over greenwashing, offering credibility and long‐term value.

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