Two Tadawul-listed entities sign first repo agreement: Report

Two financial entities listed on the Saudi Stock Exchange (Tadawul) signed the first Shariah-compliant repurchase agreement (repo), Al Eqtisadiah reported, citing government and banking sources.

Financial institutions are using such instruments, in line with certain legislative and unified regulations.

Government as well as private sukuk can be issued with repurchase guarantees, as this can provide additional liquidity solutions for local as well as international investors.

Unlike other markets, Saudi investors use “the promise of repurchase” to sell an asset with a promise to buy it back at a specific date.