The Saudi National Debt Management Center (NDMC) concluded the annual borrowing plan proposed by it for the year 2021, with a financing amount of around $33.3 billion.
The plan covered the financing needs by issuing debt instruments including Sukuk and bonds, which focused on fixed-rate instruments to hedge against risks of potential interest rate fluctuations.
Mr. Mohammed bin Abdullah Al Jadaan, the Minister of Finance and Chairman of the Board of Directors of the NMDC stated that it approved the proposal of the annual borrowing plan at the beginning of the year.
According to reports, the NDMC succeeded in arranging the issuance of sovereign bonds worth $7.7 billion, with the largest negative yield issuance ever out of the European Union, with a coverage ratio of 3.3 times the total issuance, showcasing the leading position of the Kingdom in global markets.
Earlier this year, NDMC successfully arranged for financing of $3 billion provided by Korea Trade Insurance Corporation (KSURE). Additionally, NDMC arranged the second early repurchase of part of bonds and Sukuk maturing in 2022 of a value exceeding $8.8 billion.
Hani Al-Medaini Acting CEO NDMC
“NDMC is working to broaden the investor base, open communication channels with the investors locally and internationally, and penetrate to new geographical regions. We are working with international financial institutions for joining the Primary Dealers Program of the Government Local Debt Instruments, and attracting new foreign capitals to utilize the opportunities available in debt instruments arranged by NDMC, and seizing opportunities in local and international markets.”
Mr. Al Jadaan added that 2021 financing was comprised of 60.5 percent locally and 39.5 percent internationally in line with the approved annual borrowing plan of the year, indicating that a suite of financing channels have been developed within the new initiatives and financing channels that the Ministry of Finance and NDMC are working to launch during next year including, government alternative funding, early repurchase of local government issuances, and structuring the green financing framework.
Mr. Al Jaadan also underlined the Kingdom’s credit rating, which has been upgraded to “stable” by credit rating agencies in terms of outlook, which was the result of the fiscal system’s efficiency, ability to overcome challenges, forward-thinking approach, and efforts to build plans to resolve these challenges.
