Saudi Arabia is tapping international investors with a new set of debt, becoming the hhighest-profileentrant to the bond market for the opening days of the year with its first issue since the killing of journalist Jamal Khashoggi. Despite jittery market conditions, banks are lining up dollar bonds for the Kingdom, maturing in both 2029 and 2050.
Early indications are that it will pay between 2 and 2.5 percentage points above the relevant US government bond benchmarks for the issues. The deals, which are expected to price on Tuesday, will be a test of the willingness among international investors to put money to work in Saudi Arabia despite concerns over the fate of Yemen and the violent death of Khashoggi in the Saudi embassy in Turkey — an incident that has drawn widespread international condemnation.
In April last year, the Kingdom issued debt maturing in 2030 with a regular interest payment to buyers of 4.5 per cent, and 2049 debt with a coupon of 5 per cent.