Mon, Apr 25, 2016
Gulf International Bank’s (GIB) latest bond issue met with strong demand as the bank on 19th April, 2016 successfully priced its senior unsecured SR2 billion ($530 million) five-year floating rate notes issuance at a spread of 140 basis points above three-month Saudi Arabia interbank offered rate (SAIBOR).
The issuance was well oversubscribed, achieving an attractive spread for GIB and reflecting investors’ high confidence in GIB’s financial strength and credit worthiness.
Rated A (Fitch – Foreign Currency)/A3 (Moody's – Senior Unsecured Debt), GIB’s bond issue is considered as the first financial institution issuance in the domestic Saudi riyal market since September 2015.
Initial price guidance was communicated on April 11, which resulted in strong momentum allowing GIB to price the transaction within the guidance range. The order book was well diversified and investors comprised banks, non-banking financial institutions, corporates, government agencies and investment companies within Saudi Arabia.
Abdulaziz Al-Helaissi, GIB’s Chief Executive Officer, commented: "We are very pleased with the successful closing of this bond issue at this attractive pricing level. The demand from a large number of highly respected entities reflects the market’s confidence in GIB’s experience and strong financial position.”
Al-Helaissi added: “This bond issue confirms GIB’s commitment to diversify its funding sources and utilise different funding structures to achieve the most suitable cost of funding for the bank.”
GIB Capital was Lead Coordinator for the offering, and the joint lead managers and book runners were GIB Capital, Samba Capital & Investment Management Company, Riyad Capital, and Saudi Fransi Capital.
The Bahrain-based GIB is owned by the six GCC states with Saudi Arabia’s Public Investment Fund owning a majority 97.2 per cent stake. The pan-GCC bank specialises in corporate and investment banking and has a growing retail footprint. In addition to its main subsidiaries, London-based GIB UK and Riyadh-based GIB Capital, it has branches in New York, Abu Dhabi, Dhahran, Riyadh and Jeddah with representative offices in Dubai and Beirut.
GIB provides client-focused, innovative financial products and services to a wide customer base in the region, including corporate banking, asset management, debt and equity capital market services, financial advisory services, mergers & acquisitions, Shariah-compliant banking, and retail banking services.
GIB Capital is the investment banking arm of GIB, offering innovative solutions in the fields of bond and sukuk issuance, financial restructuring, private placements, private sale, IPOs, bond and sukuk issuance, underwriting equity and debt as well as mergers and acquisitions.
