IFR Fixed Income News reported that Saudi Arabia attracted orders exceeding $15 billion for sukuk it plans to issue in two tranches with maturities of five and ten years.

The service explained that the indicative pricing for the five-year debt was set at around 95 basis points over U.S. Treasury bonds, and for the ten-year sukuk at about 105 basis points over the same benchmark.

It added that Citi, HSBC, J.P. Morgan, and Standard Chartered were appointed as global coordinators and bookrunners for the issuance, while Industrial and Commercial Bank of China and Mizuho will act as active joint lead managers.

Saudi Arabia continues to spend on its Vision 2030 program, which aims to diversify its revenue sources to reduce dependence on oil and gas income.

The kingdom has been tapping debt markets to cover its budget deficit, which is expected to reach about $27 billion this year.

Saudi Arabia’s public debt reached SAR 1.38 trillion (approximately $367.81 billion) by the end of Q2, according to the Ministry of Finance in July.

In May 2024, the Saudi National Debt Management Center announced the completion of investor order intake for the international issuance of $5 billion in U.S. dollar-denominated government sukuk under the Saudi Government International Sukuk Program.

The center said total subscription orders reached nearly $20 billion, with the coverage ratio exceeding four times the total issuance of $5 billion (equivalent to SAR 18.75 billion), divided into three tranches. The first tranche was $1.25 billion (SAR 4.68 billion) for sukuk maturing in 2027.

The second tranche was $1.5 billion (SAR 5.63 billion) for sukuk maturing in 2030, and the third tranche was $2.25 billion (SAR 8.44 billion) for sukuk maturing in 2034.