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RIYADH: Saudi Arabia allocated SR1.64 billion ($437 million) in its September riyal-denominated sukuk issuance, with the offering split across six tranches maturing between 2029 and 2041.\u00a0<\/p>\n
The largest tranche was SR705 million and matures in 2041, while the second-largest was SR650 million, due in 2031, according to the National Debt Management Center. <\/p>\n
The remaining tranches were SR205 million due in 2029, SR50 million due in 2033, SR25 million due in 2036 and SR5 million due in 2039.\u00a0<\/p>\n
Domestic borrowing\u00a0<\/strong><\/p>\n The latest sale was considerably smaller than the Kingdom\u2019s August domestic sukuk issuance, which totaled SR9.52 billion and was divided among five tranches maturing between 2031 and 2041.\u00a0<\/p>\n Saudi Arabia\u2019s 2026 Annual Borrowing Plan estimates total financing needs at about SR217 billion, including SR165 billion to cover the projected budget deficit and about SR52 billion in principal repayments on debt maturing this year.\u00a0\u00a0<\/p>\n The government plans to diversify its funding sources between domestic and international markets through public and private issuance of bonds, sukuk and loans, alongside alternative financing such as project and infrastructure financing and export-credit agencies.\u00a0<\/p>\n Saudi Arabia posted a SR34.3 billion budget deficit in the second quarter of 2026, narrowing from SR125.7 billion in the first quarter and bringing the first-half shortfall to SR160 billion. <\/p>\n Public debt stood at about SR1.69 trillion at the end of June, according to the Ministry of Finance\u2019s quarterly budget performance report. <\/p>\n The first-half year deficit was financed through borrowing without drawing on government reserves.\u00a0<\/p>\n International sukuk activity\u00a0<\/strong><\/p>\n The domestic issuance follows Saudi Arabia\u2019s $3.25 billion international sukuk sale completed earlier in September.\u00a0<\/p>\n The transaction comprised a $1.25 billion five-year tranche maturing in 2031 and a $2 billion 10-year tranche due in 2036. The order book reached about $16.5 billion, more than five times the size of the offering, according to NDMC.\u00a0<\/p>\n The sale came as Gulf borrowers returned to the sukuk market following a period of conflict-driven volatility that had pushed some issuers toward conventional bonds and other funding sources, Bloomberg reported.\u00a0<\/p>\n The Islamic Development Bank, Arab National Bank and Kuwait International Bank subsequently sold a combined $2.75 billion of sukuk, according to Bloomberg.\u00a0 <\/p>\n<\/div>\n