Saudi's SRC To Issue Domestic Sukuks With $1.3bn Funding Target

Saudi Real Estate Refinance Company (SRC) is looking to issue domestic sukuks in the coming months with the hope of raising up to SAR5 billion ($1.3bn).

While CEO Fabrice Susini told Arabian Business that the company, the kingdom’s equivalent of Fannie Mae and Freddie Mac in the US, has plans to tap the international markets for what he described as a “significant amount”.

He said: “We are currently working full speed ahead on the update of our programme because we are targeting domestic issuances somewhere by fall in possibly more than one tapping of the market.

“We have launched an RFP and we are collecting the answers because we will set up an international programme as well and we expect to have an inaugural issuance before the year end.”

SRC previously issued domestic sukuks in 2018 and 2019, raising around SAR750m ($200m).

“There are a couple of very significant digital transactions coming in the pipeline,” said Susini. “That’s only the beginning of the programmes that we intend to maintain on the domestic and international markets.”

Earlier this week SRC announced the purchase of a portfolio of home loans worth more than SAR3bn ($800m) from the Public Pension Agency.

Established in late 2017 by the kingdom’s sovereign wealth fund, SRC aims to deploy around SAR20bn ($5.3bn) before the end of the year, mostly by buying up mortgage portfolios from other lenders, it said previously in a statement.

The latest deal is the largest so far for the company and the country, which had deployed about SAR2.25bn ($600m) at the end of 2019.