UAE Central Bank to introduce Monetary Bills

UAE Central Bank to introduce Monetary Bills

The UAE Central Bank headquarters building. WAM

Business Bureau, Gulf Today

The Central Bank of the UAE (CBUAE) announced  on Monday that effective 11th January, 2021, a new securities issuance programme to licensed financial institutions and eligible investors, named Monetary Bills (M-bills) will be introduced. These securities will be auctioned and traded through Bloomberg's primary and secondary market solutions and settled through a local platform, compliant with international standards, built and operated by Euroclear Bank.

The objective of the new issuance programme is to provide a holistic solution to manage liquidity within the UAE banking sector. The launch of the M-Bills, replacing the existing conventional certificates of deposit programme, represents another important milestone towards the implementation of the new Dirham Monetary Framework announced earlier this year.

M-Bills' settlement cycle will include primary issuance to secondary market trading through a seamless interfaced platform developed jointly with Euroclear Bank, the Brussels-based international central securities depository, and Bloomberg, the global business and financial information and news leader.

CBUAE will be using Bloomberg AIM for order management processes of market operations. The issuance of M-Bills will be through a transparent auction process conducted on a regular basis. The CBUAE shall set the calendar and the volumes to be offered,