Saudi National Bank (SNB) launched a SAR-denominated Additional Tier 1 (AT1) sukuk sale, it said in a disclosure to Tadawul. The offering — which opened yesterday and will run until Thursday, 21 November — is open to both institutional and qualified retail investors. Proceeds of the offering will go towards strengthening the bank’s local currency capital base.

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What we know: The minimum buy-in stands at SAR 1 mn per sukuk, with the total size of the issuance and its terms subject to market conditions. The offering is perpetual, meaning there is no fixed maturity date, though redemption can occur under specific conditions defined in the term sheet.

Uh, Enterprise, what are AT1 bonds? They’re a common way banks raise core tier-one capital without diluting shareholders by raising equity. Additional tier one certificates (or just “AT1 certificates”) are a form of subordinated debt — they rank behind other types of bank debt in case of liquidation. That makes them riskier than senior debt, but still prioritizes them above equity holders. They pay interest in much the same way as a bond does, but usually can be converted into equity in some circumstances.

ADVISORS- SNB Capital will be quarterbacking the potential offer as the sole bookrunner, lead arranger, and lead manager.

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