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Arab News
19-03-2025
- Business
- Arab News
Saudi Arabia raises $704m through sukuk issuances in March
RIYADH: Saudi Arabia has raised SR2.64 billion ($704 million) through sukuk issuances in March as the Kingdom continues to explore opportunities in debt markets to accelerate economic diversification efforts. The latest riyal-denominated offering follows an SR3.07 billion issuance in February and SR3.72 billion in January. Saudi Arabia also raised SR11.59 billion in December and SR3.41 billion in November. The Kingdom has been playing a pivotal role in the global sukuk market, leveraging debt sales to finance projects under its Vision 2030 economic transformation plan. According to a statement by Saudi Arabia's National Debt Management Center, the issuance for March was divided into four tranches, with the first one valued at SR364 million and set to mature in 2027. The second tranche has a value of SR316 million, due in 2029, while the third, at SR1.46 billion, is set to mature in 2032. The fourth tranche worth SR500 million will expire in 2039. Sukuk, a Shariah-compliant financing instrument, allows investors to hold partial ownership of an issuer's assets while adhering to Islamic finance principles. Saudi Arabia's debt market has seen significant growth in recent years, attracting investors' interest in debt instruments amid rising interest rates. In March, a report released by Kuwait Financial Center, also known as Markaz, said that Saudi-based primary issuances of bonds and sukuk led the Gulf Cooperation Council region in 2024, raising $79.5 billion through 79 issuances. Markaz added that the Kingdom contributed to 53.7 percent of the overall primary debt issuances in the GCC region in 2024. In February, Saudi Arabia also raised €2.25 billion ($2.36 billion) through a euro-denominated bond sale, including its first green tranche, as part of its Global Medium-Term Note Issuance Program. Affirming the growth of the market of such Islamic bonds, S&P Global, in January, said that global sukuk issuance is projected to hit between $190 billion and $200 billion in 2025, driven by increased activity in key markets, including Saudi Arabia and Indonesia. In December, another report released by Kamco Invest projected that the Kingdom is expected to witness the greatest share of bond and sukuk maturities in the GCC, reaching $168 billion from 2025 to 2029. According to Kamco Invest, Saudi Arabia's maturities will be led by government issuances that are projected to hit $110.2 billion during the period.
Arab News
19-02-2025
- Business
- Arab News
Saudi Arabia raises $818m in February sukuk sale
RIYADH: Saudi Arabia raised SR3.07 billion ($818 million) through its February sukuk issuance as the Kingdom continues to tap debt markets to support economic diversification efforts. The latest riyal-denominated offering, managed by the National Debt Management Center, follows a SR3.72 billion issuance in January. The Kingdom raised SR11.59 billion in December and SR3.41 billion in November, according to official data. Sukuk, a Shariah-compliant financing instrument, allows investors to hold partial ownership in an issuer's assets while adhering to Islamic finance principles. Saudi Arabia has been a key player in the global sukuk market, leveraging debt sales to finance projects under its Vision 2030 economic transformation plan. According to the NDMC, the February issuance was split into four tranches. The first, valued at SR585 million, matures in 2029, while the second, at SR1.70 billion, is set to mature in 2032. The third tranche, worth SR404 million, is due in 2036, and the final portion, totaling SR376 million, will expire in 2039. Saudi Arabia is expected to play a leading role in driving global debt and sukuk issuance over the next two years, Fitch Ratings said earlier this month. The Kingdom's financial institutions and corporations are increasingly turning to international debt markets to diversify their funding sources, the agency noted. A separate report by Fitch projected Saudi Arabia's debt capital market to reach $500 billion by the end of 2025, supported by a growing pipeline of infrastructure and development projects. The Kingdom is also set to lead bond and sukuk maturities in the Gulf region, with redemptions expected to total $168 billion between 2025 and 2029, according to a December report by Kamco Invest. Government-issued debt will account for the largest share, with maturities projected to reach $110.2 billion during the period. Across the Gulf Cooperation Council, the debt capital market surpassed the $1 trillion mark in outstanding issuances by the end of November, Fitch said in a separate report. Meanwhile, global sukuk issuance is forecast to range between $190 billion and $200 billion in 2025, driven by activity in key markets such as Saudi Arabia and Indonesia, according to S&P Global. The credit rating agency reported that global sukuk sales totaled $193.4 billion in 2024, slightly down from $197.8 billion in 2023.
