SRC Prices $2.75bn International Sukuk for Mortgage Market

The Saudi Real Estate Refinance Company, owned by the Public Investment Fund, has completed the pricing of a dual-tranche international sukuk issuance worth a total of USD 2.75 billion, priced on 7 July 2026 and announced on 9 July 2026. The offering is government-guaranteed by the Kingdom of Saudi Arabia and forms part of the company's programme to strengthen liquidity and stability in the Saudi mortgage market.

The US dollar-denominated issuance was split into two tranches. The first tranche of USD 1.25 billion carries a 5.5-year tenor maturing on 14 January 2032, with a 5.0% coupon issued at about 99.535% of par for a yield near 5.1%, priced at around 85 basis points over US Treasuries. The second tranche of USD 1.50 billion runs for 10 years, maturing on 14 July 2036, with a 5.375% coupon issued at about 99.253% of par for a yield near 5.47%, priced at around 95 basis points over US Treasuries.

Investor appetite was strong, with a combined order book of around USD 18.7 billion, making the deal roughly six to seven times oversubscribed. The certificates were structured under Mudaraba and Murabaha arrangements, offered on a Regulation S basis to regional and international institutional investors.

This is the company's third international sukuk issuance under its programme. Following the deal, the international sukuk programme size was doubled to USD 10 billion to allow further future issuances. The company has stated a medium-term objective of raising up to around SAR 150 billion (about USD 40 billion) through international sukuk by 2030 to deepen the local mortgage market.

For residents and homebuyers across the Kingdom, the move matters because it channels fresh long-term funding into the housing finance system, supporting lenders' ability to offer mortgages and reinforcing one of the goals of Saudi Vision 2030 to raise homeownership among Saudi families.

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