SAB initiates offering of additional capital sukuk from riyal-denominated Tranche 1

Saudi Awwal Bank announced on Wednesday the commencement of the offering of a fixed-rate Sukuk tranche (“Tranche 1”) and a floating-rate Sukuk tranche (“Tranche 2”).

According to a statement on Tadawul, the Minimum Subscription is SAR 1 mln, and the Par Value is SAR 1 mln per Sak, and the offer price is subject to market conditions.

The offering value for the additional Tier 1 Sukuk will be determined according to market conditions, noting that the start date of the offering is today, October 11, and ends on October 24, 2023.

The maturity of the Sukuk will be Perpetual, with certain redemption rights as described in the base offering circular in relation to the Sukuk.

According to the bank’s announcement, the eligibility for redemption requires that the Sukuk are perpetual securities and accordingly do not have a fixed or final redemption date. However, they may be redeemed early in certain cases as detailed in the base offering circular in relation to the Sukuk.

The bank explained that the targeted class of the issuance Institutional and Qualified investors in accordance with the Rules on the offer of Securities and Continuing Obligations issued by the Capital Market Authority.

The Bank has mandated HSBC Saudi Arabia as lead manager and dealer in relation the offering and issuance of the Sukuk.

This comes with reference to the announcement made by Saudi Awwal Bank (the “Bank”) published on the website of the Saudi Exchange on 01/10/2023, relating to the Bank’s intention to issue a Saudi Riyal denominated Additional Tier 1 Capital Sukuk (the “Sukuk”) by way of private placement in the Kingdom of Saudi Arabia pursuant to a SAR denominated Additional Tier 1 Sukuk issuance programme (the “Programme”).