Alinma Bank concludes SAR 3bn Additional Tier 1 Capital Sukuk offering

ALINMA
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Riyadh – Mubasher: Alinma Bank has announced the successful completion of its SAR-denominated Additional Tier 1 Capital Sukuk issuance, raising a total of SAR 3 billion through a private placement, according to a bourse disclosure.

The offering represents a significant utilization of the bank’s SAR 5 billion Additional Tier 1 Capital Sukuk Program.

The issuance comprised 3,000 Sharia-compliant certificates, each with a par value of SAR 1 million. Moreover, the Sukuk carry a fixed annual yield of 6.5%, payable to investors on a periodic basis.

This capital-raising exercise is designed to strengthen the bank’s Tier 1 capital base, providing a more robust financial foundation to support its strategic growth and regulatory requirements.

A defining characteristic of this issuance is its perpetual nature, meaning the instruments do not have a fixed maturity date. This structure allows the bank to classify the proceeds as equity-like capital for regulatory purposes, which is a standard practice for Additional Tier 1 instruments in the banking sector.

Despite the lack of a fixed maturity, Alinma Bank specified that the Sukuk may be redeemed under certain conditions, as outlined in the legal documentation and the offering circular associated with the program.

The completion of this offering follows the bank's initial disclosure on 3 May 2026 regarding the commencement of the private placement. The successful closure of the transaction indicates a strong reception from institutional and qualified investors, who were the primary target of this private placement.

Alinma Capital Company and HSBC Saudi Arabia acted as the joint lead managers for the transaction. Their roles involved overseeing the subscription process, coordinating with institutional investors, and ensuring that the issuance complied with the regulatory frameworks established by the Saudi Central Bank and the Capital Market Authority.

The bank noted that the issuance was conducted in full compliance with the terms and conditions of the Additional Tier 1 Capital Sukuk Program. It further clarified that this announcement is intended for informational purposes and does not constitute an invitation or an offer to purchase, own, or subscribe to any securities.

The final execution of the Sukuk remains subject to the specific governing terms and conditions. By securing this SAR 3 billion injection, Alinma Bank enhances its capital adequacy ratios, positioning itself to navigate future market conditions while maintaining a strong balance sheet.

Meanwhile, the remaining SAR 2 billion of the total program limit remains available for potential future issuances, providing the bank with continued flexibility in its capital management strategy.

Alinma Bank recently announced the commencement of its USD-denominated Additional Tier 1 Capital Sukuk through a special purpose vehicle (SPV).

Source: Mubasher Source: {{details.article.source}}