Alrajhi Bank offers Tier 1 Sukuk denominated in Saudi Riyals for public subscription – Saudi Gazette

Alrajhi Bank offers Tier 1 Sukuk denominated in Saudi Riyals for public subscription – Saudi Gazette

Alrajhi bank announced the launch of its Tier 1 Sukuk denominated in Saudi Riyals on Sunday, October 30th, 2022. Alrajhi Capital, was appointed as the financial advisor and lead manager in connection with the offering, post receiving the Capital Markets Authority approval for the public offering on October 20th, 2022.

On the back of the bank's successful previous private issuance in January 2022, and the significant turnout by investors at that time, Alrajhi Bank decided to make this a public subscription. Due to this, it will be listed on the Saudi Stock Exchange (Tadawul), and hence investors will be able to actively trade and invest in the Sukuk. This will create liquidity for the Sukuk and provide a greater opportunity for investors in general, and retail investors in particular.

The bank determined a minimum investment amount of 5,000 Saudi Riyals, representing the value of five Sukuks, with each unit having a face value of 1,000 Saudi Riyals, and set the annual return on the Sukuk at 5.50%. According to the bank, Sukuk profits will be distributed to investors on a quarterly basis (every three months). The Tier 1 Sukuk shares many characteristics with equity instruments, such as ordinary shares in companies, including