Emirates airline has mandated eight banks to manage a sale of Islamic bonds, according to Business Time sources.

Among these banks are HSBC, Standard Chartered, Citigroup, BNP Paribas, Emirates NBD, Dubai Islamic Bank, Abu Dhabi Islamic Bank and Noor Bank, according to the undisclosed sources. Reportedly, the issue will raise about $1 billion in the next few weeks.

Emirates will be seeking funding from international bond markets as the US interest rates are expected to increase and with them, borrowing costs. In total, there was nearly $90 billion raised last year from issuers from Gulf Cooperation Council, which includes Saudi Arabia and the United Arab Emirates.

These issuers had been making the most of low interest rates, and sidestepping tight liquidity in the local-loans market amid low oil prices. S&P’s most recent Global Sukuk Market Outlook explains how global sukuk issuance is expected to drop by 28% in 2018 due to tighter liquidity, mounting geopolitical risks, and hurdles when it comes to standardisation.

Related: Islamic banks struggling with risk management and compliance

“Emirates always seeks diverse sources of funding, including bank finance, operating leases, Islamic financing, sukuk and bonds,” commented Emirates. “We are continually engaged in discussions with various financial institutions. We will not offer comment unless a deal is formally announced as per financial market regulations.”

Emirates usually raises funding each year from diverse sources: commercial loans, operating leases and export credit agency backed facilities. In 2015, the Dubai-based firm sold a bond when it raised $913 million from a 10-year sukuk, guaranteed by the UK’s export-finance agency, to help pay for four Airbus A380-800s.

Read more: Islamic finance popularity rocketing as it starts facing a lack of talent

by Henry Vilar
Henry is Junior Reporter at IBS Intelligence, follow him on Twitter or contact him at: henryv@ibsintelligence.com