Banque Saudi Fransi privately places sukuk

Dubai: Banque Saudi Fransi (1050.SA), or BSF, said it has privately placed a 1.9 billion Saudi riyal (Dh1.71 billion) subordinated Islamic bond, or sukuk, that will help the lender fund its expansion plans.

The sukuk, which will also support the bank’s capital base, has a seven-year maturity but can be redeemed by BSF after the end of the fifth year, and is priced at 110 basis points over 3-month SIBOR, the lender, an affiliate of France’s Credit Agricole, said in a statement posted on the Saudi bourse late on Tuesday. The remaining part of the 2.5 billion-riyal issue will be launched at a later date subject to the banks requirements, it added.

“The sukuk will support the bank’s growth plans and extend the maturity profile of its liabilities while continuing to diversify its sources of funding,” BSF said.

The bank launched a $750 million Islamic bond in May this year after setting up a $2 billion (Dh7.35 billion) sukuk programme in April.

BSF shares closed trading Tuesday at 30.30 riyals.