Saudi Arabia (GIB KSA) has been rated A2 (stable) by Moody’s and A- (stable) by Fitch. It has issued its first issue of $500 million Reg S only perpetual non-call 5.5-year AT1 bond at par with a 6.625 percent coupon.
However, the reset margin is fixed at 282.5 basis points, and the yield is 6.625 percent. Preliminary opinions on the price of the benchmark bond were in the 6.875 percent region, and the orderbooks were exceeded $1.1 billion.
Joint global coordinators were mandated by Citi and GIB Capital, with Abu Dhabi Commercial Bank, BofA Securities, Emirates NBD Capital, First Abu Dhabi Bank, Mashreq, SMBC, and Standard Chartered Bank as joint lead managers and joint bookrunners.
The first benchmark fixed-rate issuance of resettable AT1 capital issuance under the GIB KSA and $1.5 billion Additional Tier 1 Capital Note Programme.
Therefore, the AT1 bond is listed on the London Stock Exchange Main Market. The Public Investment Fund (PIF) reports that Saudi Arabia’s sovereign wealth fund owns GIB KSA.
GCC banks have been busy issuing debt this week, as the Alinma Bank of Saudi Arabia issued a $500m Tier 2 USD sukuk at 5.792 percent and the Sharjah Islamic Bank of the UAE issued a $500 million sukuk at 4.60 percent.
National Bank of Kuwait also priced a Tier 2 subordinated bond of no-grow $300 million on Wednesday at a 5.25 percent coupon.
