Details of the February local sukuk issuance worth SAR 7.868 billion

The National Debt Management Center announced the completion of receiving investor applications for its February domestic issuance, under the Saudi Arabian government's SAR-denominated Sukuk program. The total allocation for this issuance was set at SAR 7.868 billion , reflecting the continued high confidence of financial institutions and investors in the strength of the Saudi economy.

Details of the issuance tranches and maturity dates

According to the detailed statement issued by the center, the releases were divided into 5 main tranches to meet the different preferences of investors in terms of time maturities, and the distribution was as follows:

• The first tranche: It amounted to SAR 1.176 billion, for sukuk maturing in 2031.
• The second tranche: Its value amounted to 1.387 billion Saudi Riyals, for sukuk maturing in 2033 AD.
• The third tranche: Its value amounted to 1.598 billion Saudi Riyals, for sukuk maturing in 2036 AD.
• The fourth tranche: It amounted to 510 million Saudi Riyals, for bonds maturing in 2039 AD.
• The fifth tranche: It is the largest in size, amounting to 3.197 billion Saudi Riyals, for bonds maturing in 2041 AD.

The economic context and the importance of local debt instruments

This issuance comes as part of the National Debt Management Center's strategy to secure the Kingdom's financing needs in accordance with the objectives of the general fiscal policy and within the framework of the medium-term public debt strategy. These periodic issuances aim to enhance the Kingdom's ability to access local debt markets, thereby contributing to diversifying funding sources and reducing total reliance on oil revenues, which aligns with the pillars of the Kingdom's Vision 2030 .

These issuances play a pivotal role in developing the Kingdom's financial sector, contributing to the establishment of a risk-free yield curve for the Saudi Riyal, which serves as a key benchmark for pricing financing and investment products in the local market. Furthermore, the continuation of these offerings strengthens the depth of the local sukuk and bond market, providing secure investment instruments for banks, financial institutions, and pension funds.

Financial impact and sustainability

The strong demand for these sukuk, particularly the longer-term tranches (extending to 2041), reflects investor confidence in the Kingdom's financial solvency and its ability to meet its long-term obligations. Through these instruments, the Saudi government is effectively managing liquidity levels in the financial system while maintaining public debt at safe levels relative to GDP, thereby enhancing the Kingdom's credit rating with international agencies.