Saudi Arabia Issues SR7.39 Billion Sukuk, A 66.44% Increase from Previous Month
Saudi Arabia issued a SR7.39 billion ($1.97 billion) sukuk, or Shariah-compliant debt product, in April, a 66.44% increase from the previous month.
The issuance consisted of three tranches: SR2.35 billion maturing in 2029, SR1.64 billion due in 2031, and SR3.51 billion maturing in 2036.
The National Debt Management Center announced plans to expand funding activities in 2024, aiming for a total of SR138 billion.
The National Development Fund of Saudi Arabia (NDMC) completed its second government sukuk savings round for March, with a total of SR959 million in requests from 37,000 applicants.
The financial product, called Sah, offers a return of 5.64 percent and matures in March 2025.
The NDMC aims to use the funds to take advantage of market opportunities, boost general reserves, and invest in transformative projects under Saudi Vision 2030.
Fitch Ratings predicts that global sukuk issuance will continue to increase due to funding and refinancing demands.
The credit rating agency anticipates the growth of the sukuk market in the Gulf Cooperation Council region to be driven by economic diversification and the development of the debt capital market.
S&P Global's January report predicts sukuk issuance worldwide to reach between $160 billion and $170 billion by 2024, fueled by increased financing needs in Islamic nations.
Two significant factors contributing to this growth are higher financing requirements in key Islamic finance countries and easing liquidity conditions globally.