The National Commercial Bank (NCB) claims to have successfully settled an issuance of subordinated additional tier 1 capital sukuk amounting to SR2.7 billion on Dec. 23. This is stated to be Shariah-compliant done through a private placement offer in Saudi Arabia.

Sukuk issuances such as this are intended to strengthen the bank's capital base in accordance with the Basel III framework and sustain its growth while maintaining healthy capital adequacy levels.

Additionally, the sukuk will continue to extend the maturity profile of NCB's liabilities while continuing to diversify its sources of funding.

The sukuk are perpetual securities with no fixed redemption date. However, NCB has the right to call the sukuk on a predefined date.

All required approvals from the regulatory authorities have been obtained for the issuance. NCB Capital acted as the sole lead manager for the issuance.