Saudi Arabia's PIF launches first commercial paper program
Saudi Gazette report
RIYADH — The Public Investment Fund (PIF) announced on Monday the establishment of a global commercial paper program, adding a new instrument to the fund's existing set of financing tools.
The program will allow the issuance of commercial papers through special purpose vehicles (SPVs) established outside Saudi Arabia. It consists of two sub-programs: the US Commercial Paper Program and the Euro Commercial Paper Program.
PIFs Commercial Paper Program has received the highest short-term credit ratings in its category: 'P-1' from Moody's Investors Service and 'F1+' from Fitch Ratings.
The program enhances the Public Investment Fund's short-term financing flexibility and complements its long-term funding efforts. Commercial papers are widely recognized instruments for liquidity management in international capital markets, and the establishment of the program underscores the flexibility of PIF's financing strategy.
Fahad Al-Saif, Head of Global Capital Finance and Head of Investment Strategy and Economic Research at the Public Investment Fund, stated:
'The launch of the Commercial Paper Program is an extension of PIF's financing strategy — a flexible and effective strategy that aligns with our needs and supports the integration of financing solutions with our long-term investment priorities.'
PIF's medium-term financing strategy includes a diverse range of funding instruments, including sukuk, bonds, and loans.
In October 2022, the Public Investment Fund issued the first green bonds ever launched by a sovereign wealth fund, including the first-ever green bonds with a 100-year maturity. Subsequently, the fund announced the successful pricing of its inaugural international sukuk issuance, with a total offering amount of $3.5 billion.
The Public Investment Fund holds a credit rating of 'Aa3' with a stable outlook from Moody's, and an 'A+' rating with a stable outlook from Fitch.
PIF is among the world's most prominent and influential investors, working to enable new sectors and opportunities that help shape the global economy and drive economic transformation in Saudi Arabia.
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