Riyadh - Mubasher: Dar Al Balad for Business Solutions Company has officially entered into a Shariah-compliant credit facilities agreement with the Saudi National Bank (SNB) totaling SAR 20 million.
The financing package is designed to bolster the company’s operational capacity by providing the necessary liquidity for working capital requirements and supporting the issuance of primary and final letters of guarantee.
This strategic financial move, announced through a regulatory filing, underscores the company’s efforts to strengthen its fiscal position as it manages ongoing and future project obligations.
The credit facility, which adheres strictly to Islamic banking principles, was finalized on 25 June 2026.
According to the terms of the agreement, the funding will remain available to Dar Al Balad until 30 April 2027. The primary objective of this capital injection is to facilitate the issuance of bank guarantees required for various commercial contracts and to ensure the company maintains sufficient working capital to meet its day-to-day operational expenses.
To secure the SAR 20 million facility, Dar Al Balad has provided a comprehensive set of guarantees to the SNB. These security measures include the issuance of promissory notes and a formal assignment of project proceeds, ensuring that the bank has direct recourse to revenue generated from the company's business activities.
Furthermore, the agreement includes a performance and payment bond to mitigate credit risk for the lending institution.
The disclosure also highlighted the involvement of related parties in the transaction. Dar Al Balad, identified as a major shareholder in the firm, has provided a joint and several performance and payment guarantee to support the credit facility.
This involvement by the principal shareholder serves as a significant credit enhancement, reflecting the parent entity's commitment to the subsidiary’s financial stability and its ability to fulfill contractual obligations.
By securing this facility from the SNB, one of the Kingdom’s largest financial institutions, Dar Al Balad positions itself to more effectively bid for and execute large-scale projects that require substantial upfront financial backing in the form of letters of guarantee.
The flexibility provided by the working capital component of the loan is expected to assist the company in managing its cash flow cycles more efficiently during the tenure of the agreement.
The company began floating its shares on the Main Market of the Saudi Exchange (Tadawul) on 20 May, after setting the initial public offering (IPO) final price at SAR 9.75 per share.
