Emirates NBD arranges Al Rajhi’s USD 1 billion inaugural Sukuk
Al Rajhi’s Senior Unsecured Sustainable Sukuk was oversubscribed 3.75 times. Emirates NBD was a Joint Lead Manager and Joint Bookrunner.
Emirates NBD, a leading banking group in the Middle East, North Africa and Turkey (MENAT) region, has successfully priced a USD 1 billion Senior Unsecured Sustainable Sukuk for Al Rajhi Bank, the world’s largest Islamic bank by assets and market capitalisation.
The 5-year Sukuk which priced at an reoffer yield of 4.774% generated strong demand, attracting orders of over USD 3.75 billion. The robust order book allowed Al Rajhi to tighten the pricing by 40 basis points to 5-year US Treasury + 110bps from an initial price guidance of 150 basis points. The Sukuk was strongly anchored by Middle Eastern investors, who accounted for 49% of the allocation. The issue also witnessed strong demand from high quality international investors.
The Sukuk was issued under Al Rajhi’s USD 4bn Trust Certificates Program, which was established in April 2022. The proceeds will be used to finance and refinance, in whole or in part, Eligible Sustainable Projects, as set out in the Bank’s Sustainable Finance Framework. The issue represents the first debt capital market transaction by a financial institution in Central & Eastern Europe, Middle East and Africa following the recent volatility in the global banking sector.
Waleed Almogbel, Managing Director and CEO of Al Rajhi Bank said: “The success of this debut Sukuk issuance in these turbulent times reflects the confidence of investors in Al Rajhi Bank and the Kingdom’s solid foundations. We are proud to present the bank’s commitment to Sustainable financing as we look to diversify our funding strategy and are grateful for the support of our local and international investors as part of the large engagement we received during the marketing process for this Sukuk. We also look forward to publishing our annual Allocation and Impact report which will allow investors to further understand the environmental and social benefits this Sukuk transaction will create.”
Mohammad Al Bastaki, CEO of Emirates NBD Capital, said: “We are pleased to have led the successful closing of Al Rajhi’s debut sustainable Sukuk amid a volatile market environment. We pride ourselves on the confidence our clients have in our ability to support their complex needs with innovative solutions, a testament to our long history of excellence in the region’s debt capital markets. Emirates NBD remains committed to taking the lead in providing a dynamic suite of sustainable financing solutions amid increasing demand from regional and global clients.”
