Al Rajhi Bank, the world’s largest Islamic lender, has raised $1 billion from the sale of 5-year sustainable Islamic Bonds or ‘sukuk’, a bank arrangement document showed on Tuesday.
The spread for the US dollar-denominated sukuk was narrowed to 90 basis points (bps) over US Treasuries from 120 bps earlier after orders topped $2.8 billion, the document said.
The Islamic lenders engaged Al Rajhi Capital, ADCB, ADIB, Citigroup Global Markets, DIB, Emirates NBD Capital, FAB, Goldman Sachs International, HSBC Bank, KFH Capital Investment, SMBC Nikko Capital Markets, Societe Generale and Standard Chartered Bank as joint lead. administrators and accountants for the debt transaction, the document added.
Standard Chartered Bank also acted as sole sustainability architect.
Proceeds from the debt sale will be used to meet the bank’s financial and strategic goals under a sustainable financial framework, the lender disclosed in a stock exchange filing.
Last month, Saudi Arabia’s sovereign wealth fund Public Investment Fund also raised $2 billion from a 7-year sukuk sale.