Tamweel Aloula closed its first additional tier 1 (AT1) capital sukuk issuance as part of a recently-launched program, according to a press release by the transaction’s advisor impact46. The funds will go towards supporting the company’s regulatory capital requirements, according to the press release.

What we know: The issuance was completed via private placement, with the sukuk set to be listed on the Saudi Exchange after receiving approval from regulatory authorities. No details were provided on the exact size of the issuance.

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Background: Tamweel announced a SAR 500 mn AT1 sukuk issuance program last month, with initial plans to take the first issuance to market before the end of 3Q 2024. The sukuk are on offer to eligible investors in the Kingdom. The program is a first by a non-banking financial institution in Saudi Arabia, Tamweel said.

AT1 bonds? The debt instruments act as a capital cushion for banks if their capital levels fall below a certain threshold. They are seen as the riskiest debt instruments that can be issued by lenders and therefore hold a higher coupon.

IN OTHER DEBT NEWS-

Nomu-listed trade and development company Waja is gearing up for a SAR 70 mn sukuk issuance through a private placement under its SAR-denominated Sukuk Issuance Program, according to a disclosure to Tadawul. Waja has applied for permission from financial authorities and plans to funnel the proceeds towards supporting company supplies, the disclosure said.

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