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Riyad Bank is planning a USD-denominated additional Tier 1 capital sustainable sukuk issuance, with proceeds going towards shoring up its Tier 1 capital and supporting general banking activities, it said in a disclosure to Tadawul. A special purpose vehicle will take the issuance to market, with the offering open to qualified investors in the Kingdom and abroad.
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SOUND SMART- Additional Tier 1 (AT1) capital is a component of Tier 1 capital that is held by banks to shore up their financial resilience. AT1 instruments can usually be converted into equity when a trigger occurs, such as when a bank’s capital falls below a certain threshold.
The issuance comes as part of the bank’s international additional tier 1 capital sukuk program that was established earlier this month after being approved by the bank’s board in August. The value and terms of the offering will be determined at a future date subject to market conditions.
ADVISORS- HSBC, Kamco Investment, Merrill Lynch, Mizuho, Morgan Stanley, Riyad Capital, SMBC Nikko Capital Markets, Standard Chartered, and Warba Bank are serving as joint lead managers and bookrunners for the offer.
