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Al Rajhi Bank has officially completed the issuance of a USD-denominated Tier 2 social capital sukuk valued at $600 million. The offering comprises 3,000 certificates with a minimum nominal value of $200,000 each and offers a fixed return rate of 6.232%. The sukuk has a total maturity period of 10.5 years and is callable after 5.25 years, with final settlement scheduled for September 2026. The debt instruments will be listed on the International Securities Market of the London Stock Exchange.
Tier 2 debt instruments allow financial institutions to bolster their supplementary capital bases while complying with regulatory requirements. For institutional investors and regional credit markets, the successful placement reflects sustained global demand for Saudi Islamic banking paper. It provides Al Rajhi Bank with lower-cost, long-term funding to support its expanding balance sheet without diluting existing equity.
Market participants will be watching secondary trading dynamics once the certificates are officially listed in London. The successful issuance sets a positive benchmark for upcoming corporate and banking debt issuances across the GCC region.
