RIYADH: Saudi Arabia concluded its riyal-denominated sukuk issuance above the $1 billion mark for the fourth consecutive month in March, government data showed. 

The Kingdom’s National Debt Management Center revealed three tranches of the Shariah-compliant debt product were closed at SR4.44 billion ($1.18 billion). 

It was in November that Saudi Arabia’s sukuk issuance dropped below the $1 billion mark at SR2.66 billion.

In December, it rebounded to SR10.53 billion, while in January and February, it amounted to SR8.82 billion and SR7.87 billion, respectively. 

The first tranche offered in March was valued at SR203 million and is set to mature in 2029, while the second allotment, worth SR3.69 billion, is due in 2034.

The third, valued at SR540 million, will mature in 2039. 

Earlier this month, NDMC revealed that it concluded its second government sukuk savings round for March, with a total volume of requests reaching SR959 million, allocated to 37,000 applicants. 

In a statement, the insitution added that the financial product, also known as Sah, offers a return of 5.64 percent, which will have a maturity date in March 2025. 

Sah, introduced by the Ministry of Finance and NDMC, aims to increase the fund ratios among individuals by motivating them to allocate a portion of their income to savings periodically. 

In January, a report released by credit rating agency S&P Global noted that sukuk issuance worldwide is expected to total between $160 billion and $170 billion in 2024, driven by higher financing needs in Islamic nations. 

Fueled by tighter conditions in Saudi Arabia’s banking system and Indonesia’s lower fiscal deficit, global Islamic bond issuance had declined by 6.1 percent to $168.4 billion in 2023 compared to the previous year. 

The US-based agency further noted that sustainable sukuk issuance will also rise in 2024, on the back of the successful UN Climate Change Conference, also known as COP28, which concluded in the UAE in 2023. 

Last month, another report released by Fitch Ratings said that the environmental, social, and governance market for the Shariah-compliant debt products is expected to cross 7.5 percent of global outstanding Islamic bonds in the coming years.

The report added that the growth of the ESG sukuk market will be driven by issuers’ diversification plans and governments’ sustainable initiatives. 

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