Alinma Sets AT1 Benchmark with $500m Sukuk Issue
Deal News | May 23, 2025 | Zawya
In the current wave of Saudi Arabian banks issuing AT1 instruments, Alinma Bank distinguished itself by successfully raising $500 million through its US dollar AT1 issue. This marks Alinma's second entry into the market, joining the recent activities of Saudi Awwal Bank and Bank Albilad, with Banque Saudi Fransi having initiated this series. Alinma's issuance, a sustainable sukuk, was managed by leading financial institutions including Abu Dhabi Islamic Bank and Goldman Sachs, and was priced solely at 6.5%—aligning with market expectations amidst the oversaturation of Saudi debt issuances. According to Faisal Ali of Azimut, despite expectations for a pricing concession, robust demand led to a full subscription without concessions. While displaying a strong credit profile buoyed by ample reserves, Alinma Bank faces challenges from asset concentration risk and an evolving loan portfolio quality.
Sectors
- Banking
- Islamic Finance
- Capital Markets
Geography
- Saudi Arabia – The article focuses on Saudi Arabian banks entering the AT1 bond market, reflecting financial activities and trends within the region.
- United Arab Emirates – Mentioned as a restricted market for Awwal's bonds, indicating cross-border financial regulatory impacts within the MENA region.
Industry
- Banking – The article discusses Alinma Bank's issuance of AT1 instruments, part of its financial operations in the local and international banking sector.
- Islamic Finance – Alinma's sukuk issuance indicates activity within the Islamic finance industry, promoting products compliant with Sharia law.
- Capital Markets – The issuance of AT1 bonds signifies participating in capital markets, as Alinma Bank taps into international investors for capital.
Financials
- 500,000,000 USD – The amount raised by Alinma Bank through its AT1 sukuk issuance.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Alinma Bank | Target company | Company | A publicly listed Islamic bank in Saudi Arabia engaging in AT1 bond issuance. |
| Saudi Awwal Bank | Comparable issuer | Company | Another Saudi bank that recently issued AT1 bonds alongside Alinma. |
| Bank Albilad | Comparable issuer | Company | Issued AT1 bonds as part of the recent wave of Saudi banks entering international markets. |
| Banque Saudi Fransi | Initiator of AT1 trend | Company | Started the recent round of AT1 bond issuances in the Saudi market. |
| Faisal Ali | Senior Portfolio Manager | Person | Faisal Ali from Azimut provided commentary on the pricing and demand for Alinma's issuance. |
| Abu Dhabi Islamic Bank | Lead Manager | Company | Acted as a lead manager for Alinma's AT1 bond issuance. |
| Alinma Capital | Lead Manager | Company | A financial institution leading the issuance of Alinma's AT1 bonds. |
| Emirates NBD Capital | Lead Manager | Company | Supported the issuance of Alinma Bank's AT1 sukuk as one of the lead managers. |
| JP Morgan | Lead Manager | Company | One of the key financial institutions managing the issuance process for Alinma Bank's AT1 bonds. |
| Goldman Sachs | Lead Manager | Company | Acted as a managing entity overseeing Alinma's AT1 bond offering. |
| Standard Chartered | Lead Manager | Company | Part of the team leading Alinma's issuance in the AT1 market. |