Saudi Arabia's Bank Albilad raises $650m in debut USD AT1 sukuk

Bank Albilad has launched its first US dollar-denominated Additional Tier 1 (AT1) sukuk, raising $650 million through a 5.5-year perpetual non-call mudarabah structure. The sukuk, issued under the bank’s $2 billion AT1 capital sukuk programme, was priced at 6.5%, tightened from initial price thoughts of around 6.75%, following strong investor demand.

According to sources familiar with the transaction, the final order book exceeded $2.5 billion, excluding interest from joint lead managers, signalling robust market appetite for the Saudi lender’s capital instruments.

The net proceeds from the issuance will be used to strengthen Bank Albilad’s Tier 1 capital and support its general banking operations.

Albilad Capital and HSBC Bank plc acted as global coordinators and joint lead managers. Emirates NBD Capital and Goldman Sachs International served as additional joint lead managers.

The sukuk will be listed on the London Stock Exchange’s International Securities Market.

Bank Albilad holds credit ratings of A2 (Stable) from Moody’s and A- (Stable) from Fitch.