Saudi Government Sukuk Included in Two Major Emerging Market Bond Indices
J.P. Morgan and Bloomberg approve Saudi riyal-denominated government sukuk for inclusion in emerging market bond indices.
Riyadh: The Kingdom of Saudi Arabia's riyal-denominated government sukuk has been approved for addition to the J.P. Morgan Emerging Markets Government Bond Index (GBI-EM) and the Bloomberg Emerging Market Local Currency Government Index, reflecting growing investor confidence in Saudi economic transformation and integration into global capital markets.
According to an official statement from J.P. Morgan, Shariah-compliant bonds issued by the Saudi government will be phased into its GBI-EM starting January 29, 2027, with a weighted index contribution of 2.52%.
Concurrently, Bloomberg Index Services Limited announced that the Kingdom's sukuk will be included in its local currency government index effective at the end of April 2027.
These developments are significant milestones under Saudi Vision 2030, particularly within the Financial Sector Development Program aimed at diversifying, enhancing, and deepening financial markets to support private sector growth.
Expanding the domestic debt market and attracting foreign portfolio investments are central objectives of this program.
Saudi Arabia's Minister of Finance, Mohammed Aljadaan, has welcomed these inclusions, attributing them to the steadfast support from Saudi leadership.
He highlighted that such a move marks another important step in integrating Saudi Arabia into global capital markets, thereby broadening and diversifying the investor base and fostering long-term capital inflows into the domestic debt market.
Furthermore, Aljadaan emphasized the tangible benefits these inclusions will bring to the market, including increased liquidity and enhanced competitiveness of Saudi debt instruments on a global scale.
The preparations leading up to this milestone, such as J.P. Morgan's 'Positive Index Watch' designation in September 2025, have paved the way for eight issuances of riyal-denominated government sukuk with an aggregate nominal value of approximately $69 billion to be included.
Bloomberg specified that eligible securities comprise fixed-rate, riyal-denominated government sukuk with a minimum remaining maturity of one year and an outstanding amount of at least SR1 billion ($266.6 million).
The updated Bloomberg index featuring Saudi Arabia is anticipated to be available in the third quarter of 2026.
These dual inclusions follow a series of initiatives aimed at advancing the local debt market, including expanding the Primary Dealers Program to include international banks and enhancing settlement mechanisms.
Both Bloomberg and J.P. Morgan highlighted these improvements as decisive factors for their inclusion decisions, underscoring the Kingdom's commitment to developing its financial infrastructure.
According to an official statement from J.P. Morgan, Shariah-compliant bonds issued by the Saudi government will be phased into its GBI-EM starting January 29, 2027, with a weighted index contribution of 2.52%.
Concurrently, Bloomberg Index Services Limited announced that the Kingdom's sukuk will be included in its local currency government index effective at the end of April 2027.
These developments are significant milestones under Saudi Vision 2030, particularly within the Financial Sector Development Program aimed at diversifying, enhancing, and deepening financial markets to support private sector growth.
Expanding the domestic debt market and attracting foreign portfolio investments are central objectives of this program.
Saudi Arabia's Minister of Finance, Mohammed Aljadaan, has welcomed these inclusions, attributing them to the steadfast support from Saudi leadership.
He highlighted that such a move marks another important step in integrating Saudi Arabia into global capital markets, thereby broadening and diversifying the investor base and fostering long-term capital inflows into the domestic debt market.
Furthermore, Aljadaan emphasized the tangible benefits these inclusions will bring to the market, including increased liquidity and enhanced competitiveness of Saudi debt instruments on a global scale.
The preparations leading up to this milestone, such as J.P. Morgan's 'Positive Index Watch' designation in September 2025, have paved the way for eight issuances of riyal-denominated government sukuk with an aggregate nominal value of approximately $69 billion to be included.
Bloomberg specified that eligible securities comprise fixed-rate, riyal-denominated government sukuk with a minimum remaining maturity of one year and an outstanding amount of at least SR1 billion ($266.6 million).
The updated Bloomberg index featuring Saudi Arabia is anticipated to be available in the third quarter of 2026.
These dual inclusions follow a series of initiatives aimed at advancing the local debt market, including expanding the Primary Dealers Program to include international banks and enhancing settlement mechanisms.
Both Bloomberg and J.P. Morgan highlighted these improvements as decisive factors for their inclusion decisions, underscoring the Kingdom's commitment to developing its financial infrastructure.
