Arab News, Wednesday, May 31, 2023 | Thul-Qidah 11, 1444
Saudi Real Estate Refinance Co. issues $933m in sukuk to spur liquidity in realty market
Saudi Arabia:
The Kingdom’s housing market will get a fresh stream of liquidity, with Saudi
Real Estate Refinance Co. announcing SR3.5 billion ($933 million) in sukuk
issuances.
The latest issuance of the SRC, owned by the
Public Investment Fund, marked the sixth tranche under its upsized SR20 billion
sukuk program.
The real estate finance company will keep boosting
market liquidity and assisting lenders and investors, which will stabilize the
Saudi mortgage market, stated SRC CEO Fabrice Susini.
Furthermore, this move will also speed up the rise
of homeownership in the country, he added.
“The positive response from investors to SRC’s
latest sukuk issuance is a clear testament to the strength of the Kingdom’s
housing market and economy,” Susini said.
“As SRC continues to refinance existing financings
for financiers, we are proud to contribute to developing a robust secondary home
financing market that supports the efficiency and stability of the primary
housing market,” the CEO continued.
Earlier this month, SRC received an “A-”
classification at the level of global credit and “ksaAAA” at the level of local
credit with a stable outlook from the credit rating agency S&P Global.
According to the rating company, an obligatory
rated “A-” falls under an upper-medium category, indicating strong
creditworthiness and a good capacity to meet its financial commitments.
On the other hand, a rating of “AAA” on the
national scale means the debtor’s capacity to meet its financial commitments on
the obligation relative to other national debtors is extremely strong.
According to the SRC website, the real estate
financing company is rated “A-” stable by Fitch Ratings and “A2-” stable by
Moody’s Investors Service.
Founded in 2017 by the Kingdom’s PIF, SRC’s primary role is to provide banks and
real estate finance companies with liquidity, enabling growth in the home
financing sector to increase homeownership rates among Saudi citizens.
The company issued two sukuks in 2022, the first
tranche totaling SR4 billion in April and the other SR3 billion in September.