Saudi Hollandi completes SAR775 million bond sale
"The successful closure of this Sukuk puts SHB as the first bank in the Middle East to support its capital in a Shariah-compliant manner,"commented SHB Chairman Mubarak Al-Khafrah after closure of the issue.
"The Kingdom is one of the fastest growing markets in the world for Islamic banking and finance and with this Sukuk issue, SHB extends its long tradition of bringing innovative financing solutions to the Saudi market." Al-Khafrah also thanked SHB's Shari’ah Committee for their guidance and support in the Sukuk transaction.
Geoff Calvert, SHB's managing director, said, "the SAR775 million Mudaraba Sukuk is a Shari’ah-compliant follow-up to the bank's first Tier-II capital bond for 700 million that was issued in 2004." He added that,
"SHB's Sukuk issue is the first by a bank in the Middle East and is expected to set the standard for future Shari’ah-compliant debt issues in the Kingdom and the region.
The Sukuk is a Floating Rate Note (FRN) with tenor of 10 years, with a call option at the end of five years. Investors will receive SIBOR (Saudi interbank offered rate) plus two percent per annum to be distributed bi-annually. Saudi Hollandi Capital acted as sole lead manager and book runner.