Saudi bond sale: Top banks among lead managers

Deutsche Bank and Goldman Sachs are among banks hired to act as co-lead managers for the international bond sales, according to reports.
Updated 15 July 2016
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Saudi bond sale: Top banks among lead managers

LONDON: Saudi Arabia appointed six banks as co-lead managers on its first international bond sale, according to people familiar with the matter.
The Kingdom hired Bank of China Ltd., BNP Paribas SA, Deutsche Bank AG, Goldman Sachs Group Inc., Mitsubishi UFJ Financial Group Inc. and Morgan Stanley to arrange the sale, the people said.
The banks will hold a meeting later this month to start working on the deal, two of the people said.
The managers will work with HSBC Holdings Plc, JPMorgan Chase & Co. and Citigroup Inc., who were said to have been appointed global coordinators last month for the sale of at least $10 billion of bonds.
Saudi Arabia plans to boost debt as it looks to plug an estimated shortfall of about $100 billion in its budget this year and fund an economic transformation plan.
Government debt levels will increase to 30 percent of economic output by 2020 from 7.7 percent, according to the government.
The plunge in crude is driving bond sales across the six-nation Gulf block as governments seek to fill fiscal gaps the International Monetary Fund says could reach $900 billion by 2021.
Kuwait, which plans to raise as much as $9.9 billion from a bond issue in September, is willing to liaise with Saudi Arabia on the timing of the sale, Finance Minister Anas Al-Saleh said in a phone interview Monday.
Qatar raised a record $9 billion in May and Abu Dhabi sold bonds worth $5 billion in April.
Spokesmen for Goldman Sachs, Morgan Stanley and Deutsche Bank declined to comment.
A spokeswoman for BNP Paribas also declined to comment.
MUFG didn’t immediately respond to an e-mail requesting comment.
A call to the London offices of Bank of China wasn’t immediately answered, while Saudi Ministry of Finance couldn’t be reached for comment outside of office hours.


RBS says Saudi bank merger boosts its core capital

Updated 16 June 2019
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RBS says Saudi bank merger boosts its core capital

  • RBS had a 15.3% interest in Alawwal bank
  • The changes would boost the banks CET1 core capital ratio by 60 basis points

Royal Bank of Scotland (RBS) said on Sunday the completion of a merger between Alawwal bank and Saudi British Bank would lead to RBS shedding $5.9 billion of risk weighted assets and boost its core capital.
RBS, through Dutch subsidiary NatWest Markets N.V., was part of a consortium including NLFI and Banco Santander S.A. that held an aggregate 40% equity stake in Alawwal bank, the British bank said in a statement. RBS also had an interest equivalent to a 15.3% stake in Alawwal bank.
RBS said that as a result of the merger completion, it would recognise an income gain on disposal of the Alawwal bank stake for shares received in Saudi British Bank of almost $503 million and a reduction in risk weighted assets of nearly $5 billion.
RBS also said the deal would extinguish legacy liabilities of almost $377.
The changes would increase the bank's CET1 core capital ratio by 60 basis points, it said.
The merger will also help RBS to focus on its target markets, RBS chief executive Ross McEwan said in a statement.
RBS, which was rescued in 2008 with a nearly $57 billion capital injection by the British government, has been shrinking its overseas operations since the financial crisis to focus on its UK lending operations.