RIYADH: Saudi Arabia has completed a riyal-denominated sukuk bond issue for July worth 3.21 billion riyals ($855.7 million), according to the National Debt Management Center.
The level remained above 3 billion riyals again, continuing from the 4.4 billion riyals in June, 3.23 billion riyals in May, 7.39 billion riyals in April and 4.4 billion riyals in March.
NDMC reveals Shariah-compliant debt products in July, divided into 5 installments
The first tranche is worth 612 million riyals and is due in 2029, while the second tranche is worth 159 million riyals and is due in 2031.
The third installment is worth SR961 million and is due in 2034, and the fourth installment is worth SR1.25 million and is due in 2036.
The fifth installment is worth SAR226 million and is due in 2039.
This is part of the Saudi Arabia Sukuk issuance program, which was launched in 2017 with the aim of establishing an unlimited riyal-denominated Sukuk issuance program under the NDMC.
The NDMC announcement comes as Kuwait’s financial hub Markaz releases its own figures on bond and sukuk issuance across the Gulf Cooperation Council region for the first half of 2024.
The analysis shows Saudi Arabia was the leading player in the six months ended June, raising $37 billion through 44 equity offerings.
Global sukuk issuance is expected to reach $160 billion to $170 billion in 2024, flat from $168.4 billion in 2023 and $179.4 billion in 2022, a report released by S&P Global in April said.
The issuance of this Shariah-compliant debt product will begin on a “solid footing” in 2024, with Saudi Arabia emerging as a key contributor to the performance, the US-based company said.
The rating agency also noted that the sukuk bond market is set to continue to grow in the near term, supported by capital demand in key Islamic finance countries, coupled with ongoing economic transformation programmes in countries such as Saudi Arabia.
The report also said that “the decline in issuance in 2023, mainly due to tighter liquidity in the Saudi banking system and a narrowing fiscal deficit in Indonesia, was partly offset by an increase in issuance of foreign-currency sukuk bonds.”
In April, another report released by Fitch Ratings echoed a similar view, saying that global sukuk issuance is expected to continue to grow in the coming months of the year.
Fitch said economic diversification efforts and the rapid development of debt capital markets in the Gulf Cooperation Council region will drive growth in the sukuk market in the coming months.
