Banque Saudi Fransi, partly owned by Credit Agricole SA, said it received approval from the Saudi central bank to issue as much 2.5 billion riyals ($667 million) in sukuk.
The Islamic bonds will enhance the bank’s capital base and help expand its lending activities, the Riyadh-based lender said in a statement to the Saudi bourse website today. The maturity of the sukuk is no more than five years, it said.
Sales of sukuk in the six-member Gulf Cooperation Council have almost quadrupled this year to $18.5 billion as Saudi Arabia’s state-run General Authority of Civil Aviation and Qatar’s government sold $4 billion each, according to data compiled by Bloomberg. Qatar International Islamic Bank and Riyadh-based Kingdom Holding Co., the investment company of Saudi billionaire Prince Alwaleed bin Talal, are among those that plan to tap the sukuk market.
Banque Saudi Fransi will seek further approval for sukuk, according to the statement.