Abu Dhabi's state fund Mubadala is in early discussions with banks for a potential dollar bond issue, two banking sources said, as the region seeks liquidity amid the double blow of historically low oil prices and the coronavirus pandemic.

Abu Dhabi, Qatar and Saudi Arabia last month raised a combined $24 billion to bolster their finances amid the low oil prices and lockdowns that could lead to a deep recession across the region.

Mubadala has not yet mandated banks for a debt sale but banks have been actively pitching for the potential deal, the sources said, one of them adding that 10 to 15 large banks were interested. Mubadala declined to comment on a Reuters query regarding the talks.