Saudi Arabia Issues New Sukuk Worth $17.09 Billion
In a bold move, Saudi Arabia has issued new sukuk worth an impressive SR64.1 billion ($17.09 billion) after completing an early purchase of more than SR63.1 billion of outstanding debt. This strategic move showcases the Kingdom’s commitment to strengthening its domestic market.
Three Tranches, Three Maturities
The new Shariah-compliant debt product has been divided into three tranches, each with its own unique maturity date. The first tranche, valued at SR16 billion, is set to mature in 2031, while the second tranche amounting to SR29.3 billion will be due in 2034. The third tranche, worth SR18.8 billion, is scheduled to mature in 2039.
NDMC’s Efforts to Manage Government Debt
The National Debt Management Center (NDMC) expressed its satisfaction with the new sukuk issuance, stating that it enables them to manage government debt obligations and future maturities effectively. This initiative aligns NDMC’s efforts with other initiatives aimed at enhancing public fiscal stability in the medium and long term.
Global Trust Certificate Issuance Program
On May 29, NDMC successfully completed a $5 billion international trust certificate issuance under the Kingdom’s Global Trust Certificate Issuance Program. The overwhelming response to the issuance was evident, with the total order book of applications reaching around $20 billion, marking an oversubscription of four times.
Positive Projections for Global Sukuk Market
Amidst these developments, global sukuk issuance is projected to remain robust in the coming years. Analysts at S&P Global forecasted that sukuk issuance globally is expected to range between $160 billion and $170 billion by 2024. Fitch Ratings also echoed similar views, predicting continued growth in the global sukuk market, driven by economic diversification efforts and the rapid development of the debt capital market in the Gulf Cooperation Council region.