Saudi Arabia expects to issue bonds in H1: DMO

Saudi Arabia’s Debt Management Office (DMO) expects to issue international sukuk and a tranche of bonds during the first half of 2018, DMO head Fahad Al-Saif told Al Arabiya TV.

The issuance depends on the situation of the global market, he said, adding that a tranche will be announced soon.

The Kingdom has succeeded in “stabilizing the recent fiscal reforms and taking advantage of a 30 percent reduction in the cost of debt issuance,” Al-Saif added.

The Ministry of Finance has started to implement the medium-term debt strategy, which relies on geographical loan distribution at the best cost, reflecting previous and ongoing reforms, Al-Saif said.

The DMO last week announced that Saudi Arabia was expanding the refinancing of a $10 billion international loan to raise $16 billion.

An Islamic tranche would be included so that the Kingdom would meet the high international demand for its sharia-compliant finance, it said.

Saudi Arabia was also able to reduce the debt cost of the $10 billion loan, which matures in 2021, to 75 basis points from 102 basis points above London Interbank Offered Rate (LIBOR), Al-Saif said.