Saudi Arabia: Banque Saudi Fransi has completed the sale of its dollar-denominated sukuk valued at $900 million with an annual return of 4.75 percent under the Trust Certificates Issuance Program, the company said in a bourse filing.   

The bank said that the sukuk issuance is for five years and is scheduled to take place through a special-purpose entity, with an offer made to qualified Saudi and international investors.   

The bank appointed seven local and international banks to manage its issuance of dollar-denominated sukuk.  

According to market reports, the certificates’ value and terms will be decided later, and the funds will be used for Islamic financial businesses.   

Citigroup Global Markets Ltd., First Abu Dhabi Bank PJSC, Goldman Sachs International, HSBC Bank, Mizuho International, and Saudi Fransi Capital have been appointed joint lead managers.   

The bank also said that the certificates would be listed on the International Securities Market of the London Stock Exchange and sold in keeping with Regulation S of the US Securities Act 1933. 

It recently posted a 23 percent rise in net profit to SR1.07 billion in the first quarter of 2023, compared to SR 875 million in the year-ago period.    

The Islamic finance industry is witnessing a flurry of activities and is forecast to grow in 2023-2024 thanks to Saudi Arabia’s robust banking system, according to a report from S&P Global Ratings.  

The US-based agency expects around 10 percent growth across the industry in the aforementioned period following a similar expansion in 2022, with the Kingdom and Kuwait largely fueling last year’s rise.  

S&P Global Ratings also believe that despite a predicted economic slowdown and a decline in sukuk issuance this year, new product supplies will exceed those set to mature.  

It echoes findings from US-based Fitch Ratings released in April, which claimed the global sukuk issuance for the second quarter of 2023 is building up even as it faces short-term uncertainties amid continued macro-volatilities.