Abu Dhabi government-owned Al Hilal Bank has confirmed the appointment of three banks to manage its debut $500 million Islamic bond issue, which will be issued later this year, its chief executive said on Monday.

"We have started the preparatory work for issuing our first sukuk for which we are still at an early stage. We hope that this year we can tap the market," CEO Mohamed Berro said in an interview on the sidelines of an Islamic finance and banking conference in the capital of Oman.

Asked about which banks have been appointed for the issue, he said: "It is the National Bank of Abu Dhabi, HSBC  and Standard Chartered Bank."

Sources told Reuters in November these three institutions had been picked by Al Hilal to run its maiden debt capital markets offering.

Berro said the issue would help fund the bank's growth and strengthen its balance sheet. The unlisted bank was set up in 2008 and is wholly owned by the Abu Dhabi Investment Council.

It earned its first profit of Dh140 million ($38.12 million) in 2010. The lender was one of two Abu Dhabi banks which subscribed to a $5 billion bond under the Dubai government's $20 billion bond  programme - issued on the same day Dubai World announced it needed to restructure $25 billion of debt obligations.

"I think investor appetite for Islamic bonds is high which has been proven in the last year or so."

Asked whether Al Hilal Bank might issue a second sukuk in 2012, Berro said: "Most probably not. We are continuing our momentum of growth in 2012," he added.

The Al Hilal bank chief said, "2010 was a profit year, 2011 will be another 50 per cent growth over our profit, exceeding Dh200 million in profit for 2011." I expect a double-digit growth in 2012," he added.-Reuters