Saudi debut sukuk set at $9 bln, attracts $33 bln orders

13/04/2017 Argaam

Saudi Arabia has set the final issuance amount for its first international Islamic bond or sukuk at $9 billion, split equally between a five-year and a 10-year tranche, the kingdom’s finance ministry said in a statement on Thursday.

 

The issuance attracted total orders of more than $33 billion (SAR 123.75 billion) and the strong investor interest reflects the strength of the kingdom’s economy, the ministry added.

 

On Wednesday, Reuters reported citing the lead managers, that the pricing on both tranches of the sukuk has been trimmed by 10 basis points (bps).

 

Said to be the largest sukuk ever issued, the government sold a $4.5 billion worth of the five-year sukuk maturing in 2022 and a ten-year tranche of equal size, maturing in 2027.

 

Saudi Arabia is tapping international and domestic markets to help finance a budget deficit that is likely to reach SAR 316 billion this year. The kingdom raised $17.5 billion in October and Saudi Arabian Oil Co., the world’s largest oil producer, sold $3 billion of Islamic bonds for the first time last week.

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