Saudi Arabia hired Citigroup, JPMorgan Chase and HSBC as global coordinators on its international Islamic bond sale. The kingdom also picked Deutsche Bank and BNP Paribas among others as lead managers for the sale. The sukuk could come as soon as this month. Saudi secretary-general of the Finance Committee, Mohammad Al Tuwaijri, announced in December the kingdom's plans to raise between $10 billion and $15 billion from international bond markets in 2017 and sell about 70 billion riyals locally. The world’s biggest oil exporter is considering international and domestic debt issues to help finance its budget deficit.
Islamic bonds trailed emerging-market debt for a second year, a trend that is expected to continue this year. Compared with a 18.5 per cent yield for developing-nation securities, Global Sharia-compliant notes gained 9.6 per cent last year.
Falling yields have helped to push worldwide sales of debt that comply with Islam's ban on interest, and sales may increase this year as new countries including Oman, Tunisia and Egypt tap the Sharia-compliant capital market for the first time.