RIYADH: Saudi Arabia has completed its riyal sukuk issuance for July at SR3.21 billion ($855.7 million), according to the National Debt Management Center.
The level remained above SR 3 billion again, after an issuance level in June of SR 4.4 billion, SR 3.23 billion in May, SR 7.39 billion in April and SR 4.4 billion in March.
NDMC disclosed that the Shariah-compliant debt product in July was split into five tranches.
The first tranche is valued at SR 612 million and is due to mature in 2029, while the second tranche amounted to SR 159 million due in 2031.
The value of the third tranche was SR 961 million, due in 2034, and the fourth was a SR 1.25 million tranche due in 2036.
The fifth tranche had a size of SR 226 million with maturity in 2039.
This is part of the Kingdom's Sukuk Issuance Program, which began in 2017, with the aim of establishing an unlimited riyal-denominated sukuk initiative within the NDMC.
The announcement from NDMC came as Kuwait's financial hub Markaz released its own figures for bond and sukuk issuance in the Gulf Cooperation Council region for the first half of 2024.
The analysis showed that Saudi Arabia was the main player in the six months to the end of June, raising $37 billion through 44 shows.
A report released by S&P Global in April said global sukuk issuance is expected to oscillate between $160 billion and $170 billion in 2024, holding steady from $168.4 billion of dollars observed in 2023 and $179.4 billion in 2022.
According to the US-based firm, issuance of this Shariah-compliant debt product started on a “strong basis” in 2024, with Saudi Arabia becoming a key contributor to performance.
The credit rating agency also noted that the sukuk market will continue to grow in the short term, driven by funding needs in core Islamic finance countries, along with economic transformation programs currently underway in countries such as Saudi Arabia .
It added: “The decline in issuance volumes in 2023, which resulted mainly from tighter liquidity conditions in Saudi Arabia's banking system and Indonesia's smaller fiscal deficit, was somewhat offset by an increase in foreign currency sukuk issuance foreign”.
In April, another report released by Fitch Ratings also reflected similar views and noted that global sukuk issuance is expected to continue to increase in the coming months of this year.
Fitch noted that economic diversification efforts and the rapid development of the debt capital market in the Gulf Cooperation Council region will propel the growth of the sukuk market in the coming months.
