Riyad Bank raises SAR 13.59 billion from sukuk issuance at 6.5% yield
Riyad Bank has raised SAR 13.59 billion from a Tier 1 sukuk offering, with a fixed annual yield of 6.5% paid quarterly, after strong investor demand.
Riyad Bank successfully issued SAR 13.59 billion worth of Tier 1 sukuk, with a fixed annual yield of 6.5%, paid out quarterly. The offering, which was more than twice oversubscribed, led to an increase in the initial issue size to SAR 10 billion. The bank issued 10 million sukuk, each with a nominal value of SAR 1,000. These sukuk are perpetual but can be redeemed early starting from the fifth year.
The yield will be reset on August 13, 2031, and then every five years following that. Riyad Bank's net profit saw a 2% increase year-on-year to SAR 2.65 billion in the second quarter. This growth was due to increased total operating income and trading income, as well as higher dividend income. However, it was partially offset by higher operating expenses, particularly due to increased depreciation and staff salaries.
Riyad Bank, established in 1957, operates with a market capitalization of SAR 81.5 billion. The Public Investment Fund is the largest shareholder with 21.7%, followed by the General Organization for Social Insurance at 10.4%.
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