FAQs:
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What is Sukuk?
Sukuk are securities, which are intended to be Shariah-compliant, through which investors provide funding to an issuer in return for periodic profit distributions (subject, in the case of the Sukuk, to any cancellation or write-down in accordance with the terms and conditions). The proceeds raised through the Sukuk are typically used by the issuer for its financing purposes.
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What are the main objectives of the Riyad Bank’s additional tier 1 capital public sukuk programme?
The offering program provides Riyad Bank the ability to issue additional tier 1 capital public sukuk and use the proceeds therefrom to enhance its tier 1 capital as well as for general banking purposes.
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What is the maturity of the Sukuk and can it be redeemed early?
Perpetual subject to early redemption on a Call Date starting from its fifth anniversary subject to the Terms and Conditions or as otherwise specified in the Base Prospectus and the applicable final terms relating to the Sukuk.
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Which categories of investors can subscribe to this sukuk?
All categories of investors permitted under the Saudi Capital Market Authority’s Rules on the Offer of Securities and Continuing Obligations are entitled to subscribe to the Sukuk. Persons wishing to purchase the sukuk of the relevant series will be required to submit a duly completed investor subscription application ("Investor Application") before the end of the offering period and pay the value of the Sukuk of that series in accordance with the instructions contained in the Investor Application.
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What is the sukuk offering period and how will it be specified?
Each offer period (the “Offer Period”) for the relevant tranche of the sukuk will be specified in the applicable final terms. The relevant tranche of sukuk will be allocated after the end of the applicable Offer Period and issued on an issue date after the end of the relevant Offer Period and as specified in the applicable final terms.
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What is the total nominal value of the sukuk for this public issuance of Additional Tier 1 capital sukuk?
The issuance amount has been determined on an initial basis at SAR 5,000,000,000. The definitive issuance amount will be determined after the completion of the offer period, based on market conditions at that time
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What is the method of subscription in the sukuk?
Persons wishing to purchase the sukuk of the relevant series will be required to submit a duly completed Investor Application during the applicable Offer Period from one of the receiving entities. Institutional Clients and Qualified Clients must submit their Investor Application Form to the relevant Dealer(s), while other legal or individual persons must submit their Investor Application Form to the designated Receiving Entities. Payment for the sukuk of such series shall be made as per the instructions contained in the Investor Application Form. Investor Application Forms will be available from the relevant dealer(s) or receiving entities.
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How will sukuk be allocated for each tranche?
The allocation of Sukuk for each Tranche will be determined by the Issuer, in consultation with the relevant Dealer(s), following the close of the applicable Offer Period. Investors may be allocated all or only a portion of the amount for which they applied.
Following completion of the allocation process, the Issuer will announce the aggregate nominal amount of the relevant Tranche and the applicable profit rate, margin and/or initial periodic distribution rate, as the case may be (subject to cancellation in accordance with the terms and conditions). Any unallocated subscription amounts will be refunded in accordance with the terms of the applicable Investor Application and offering documentation.
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What is the method of allocation for each series of sukuk?
Following the close of the applicable subscription period, the Issuer, together with the Sole Arranger and the Dealer(s), will determine the allocation of the Sukuk of the relevant Series. The specific allocation methodology, relevant deadlines and other details of the offering process will be set out in the relevant announcement published by the Issuer on the Tadawul website and in the Investor Application. Investors may receive all or only a portion of the amount for which they applied. Following completion of the allocation process, successful applicants will be notified of their allocation and any excess subscription monies will be refunded in accordance with the terms of the relevant offering documentation.
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With respect to initial period of sukuk, what is the profit that will be yielded by each series of sukuk?
Each series of sukuk will bear a profit at the relevant initial periodic distribution rate. Thereafter, the relevant profit rate will be reset on each reset date based on the relevant total margin, as well as the relevant reset rate on the determination date, as may be determined by the payment administrator. The Bank can elect not to pay any periodic distribution amount (save in respect of the final periodic distribution amount) as detailed in the Terms and Conditions (“Non-payment Election”)
There are also circumstances where the Bank will be prohibited from making payments of any periodic distribution amount (including any final periodic distribution amount), as detailed in the Terms and Conditions (“Non-payment Event”)
From the date of such Non-Payment Election or Non-Payment Event (the “Dividend Stopper Date”), the Issuer will be prohibited from declaring or paying certain distributions, dividends or other payments as detailed in Terms and Conditions.
Riyad Bank, a public joint stock company with a share capital of SAR 40 billion, Commercial Registration No. 1010001054 and unified number 7000022868, P.O. Box 13519, Riyadh 6671, telephone +966 11 401 3030, National Address: King Abdullah Financial District (KAFD), Financial Boulevard, Al Aqiq District, Building No. 3128, Riyadh, Kingdom of Saudi Arabia.
Website: www.riyadbank.com.
Riyad Bank is licensed pursuant to Council of Ministers Resolution No. (91) dated 01/05/1377H and is subject to the supervision and regulation of the Saudi Central Bank (SAMA).
The Capital Market Authority and the Saudi Stock Exchange Company take no responsibility for the contents of this disclosure, make no representations as to its accuracy or completeness, and expressly disclaim any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this disclosure.
Prospective purchasers of the securities offered hereby should conduct their own due diligence on the accuracy of the information relating to the securities. If you do not understand the contents of this announcement you should consult an authorised financial advisor.
The Sukuk are complex financial instruments and are of high risk and are not a suitable or appropriate investment for all investors. In some jurisdictions, regulatory authorities have adopted or published laws, regulations or guidance with respect to the offer or sale of securities similar to the Sukuk, including, without limitation, prohibitions on the offering or sale of such securities to persons who are not institutional or qualified clients. In addition, financial institutions located and licensed in jurisdictions outside Saudi Arabia may be restricted from investing in securities similar to the Sukuk that are issued by an entity that does not conduct all of its activities and business in accordance with the principles of Shariah.
The value, price and returns of securities may rise or fall, and the income from securities may fluctuate. Accordingly, there is a possibility that the value of an investment may decline below its original cost, and investors may recover less than the amount invested. In certain circumstances, part of the invested capital may be used to pay such income. Past performance is not necessarily indicative of future results.
The Sole Arranger and Dealer to the offering engages in financial brokerage and investment activities and may provide, or may have provided during the previous 12 months, investment services to companies whose securities are the subject of transactions. The Sole Arranger and Dealer, its employees, one or more of its affiliates, or its clients may have financial interests in the relevant securities. The sender of this announcement may receive, or may have received, benefits in consideration for its dissemination.
Investment services involve risks and may not be suitable for all persons. Investors should carefully review and understand the terms and conditions applicable to investment services and obtain appropriate legal, tax, shariah and financial advice before making any investment decision. Furthermore, the disclosure is for information only and does not constitute an invitation or offer to acquire, purchase or subscribe for debt instruments.
on 26/01/1448H (corresponding to 12/07/2026G).
On 27/01/1448H (corresponding to 12/07/2026G), the Capital Market Authority published the base prospectus relating to Riyad Bank’s SAR 10,000,000,000 Additional Tier 1 Capital Public Sukuk Programme.
The Base Prospectus is available in English language here
