Saudi Arabia launches sukuk dealer scheme

Arabic_coinsSaudi Arabia’s ministry of finance has issued $925 million of Islamic bonds through a new primary dealer scheme designed to boost investor appetite for the asset class. Five local banks – Alinma Bank, Samba Financial Group, Bank Aljazira, National Commercial Bank and Saudi British Bank – will act as market makers by buying the sukuk directly from the government and quoting two-way prices to other investors. The ministry is also introducing an electronic auction platform which allows more than 20 financial institutions and asset managers to submit bids from their own books and on behalf of their investors. “Market making will play an active role in stimulating the financial market as a whole and significantly increasing the liquidity in the secondary market,” stated the ministry. The amount raised in sukuk issuance in the GCC in the first half of 2018 has fallen by 60% from the same period in 2017 with five issuers raising $2.6 billion. According to rating agency Standard & Poor’s, this is a result of GCC corporations’ “limited investment programmes” and “investors’ increased risk perception of the GCC over the last 12 months due to political developments”. ©2018 funds global mena

Executive Interviews

INTERVIEW: Totally mega

Jun 13, 2018

In 2016, global consulting firm PWC forecast the emergence of five global ‘megatrends’ in the next two decades. Stephen Anderson, its Middle East clients and markets leader, talks about their...

INTERVIEW: Protecting the investment

Nov 23, 2017

Rasmala’s trade finance fund recently passed $100 million in assets. Doug Bitcon, head of credit strategies, explains why he has to be hands-on.


MENA ROUNDTABLE: ‘The story is about reforms’

Jun 13, 2018

Our cross-industry panel discuss the positive backdrop in Egypt, the Dana Gas controversy and the potential index upgrades of Saudi Arabia and Kuwait. Chaired by George Mitton in Dubai.


Jun 13, 2018

Our panellists tell us that instead of launching competing national projects, African countries should work together for the sake of a bigger capital market. Chaired by George Mitton in Cape Town.