Riyadh – Mubasher: Samba Financial Group succeeded to price a $1 billion bond due in five years in 2024.

Marking the firm’s first transaction since 2006, the bond was priced at a fixed coupon rate of 2.75% per annum. The firm’s orderbook registered over $3.7 billion from over 140 accounts, representing a subscription rate that hit 3.7 times, which indicates an immense demand from the part of investors.

Samba’s bond reflects its efforts in evolving the regional capital markets, being the sole Saudi bank having a bond in international markets, according to a press release on Thursday.

Following a global marketing exercise, Samba’s bond comprises extensive investor meetings across London, Hong Kong, Dubai, and Abu Dhabi. Remarkably, Samba was able to “tighten” pricing by 25 basis points (bps) from initial price thoughts of MS+165bps to final pricing of MS+140bps.”

Furthermore, Samba’s orderbook showed a significant diversity; allocating 73% of the bond to international investors, compared to 27% in Middle Eastern accounts. As regards investor type, 52% of the bond was allocated to fund managers, 37% to banks, 9% to insurance/pension funds, while 2% was dedicated to others.

Samba’s management record of accomplishment, which succeeded in achieving its “size, price, and tenor objectives”, as well as the firm’s strong credit fundamentals against regional and international peers have backed for gaining investors’ confidence and satisfaction. Additionally, Samba enjoys an investment rating of “A1/BBB+/A- (all stable) by Moody’s/S&P/Fitch”.

In this regard, Samba pointed out that the “access to the international capital markets through this bond issuance will serve to diversify the bank’s funding sources in a cost-efficient manner.”

“Samba appointed First Abu Dhabi Bank (FAB), Goldman Sachs International, HSBC, Samba Capital, and Standard Chartered Bank as Joint Lead Managers, Bookrunners, Allen & Overy acted as counsel to Samba, and White & Case acted as counsel to the Joint Lead Managers and Bookrunners,” according to the press release.