Reducing Par Value of Sukuk and Bonds Motivates All Community Members to Increase Their Investment in Government Debt Instruments

 In line with the Debt Management Office efforts in developing domestic sukuk market and diversifying its investors base, Tadawul has started to apply the amendment of the Par value of the domestic government debt instruments (sukuk) issued by the Saudi government from one Million Riyal to one thousand Riyal without changing the size of the issuance. This includes 29 issuances of investment instruments issued to finance the budget. It is estimated that the size of the bond and sukuk market currently stands at about 292 billion riyals, representing 66 issues, including 5 issues for the private sector and the rest for the government.

“The future is dawning and promising opportunities are blooming,” Ziad Aba Al Khail, CEO and Managing Director of Al Jazira Capital, said on this occasion. He also praised this significant step in developing the Saudi Stock Exchange and sukuk, bond and debt instruments market, motivating issuers to list local-currency sukuk and bonds in Saudi Debt Market and encouraging investors to trade these instruments to increase liquidity in the Saudi market.

“Al Jazira Capital is one of the first companies that provide integrated services to customers wishing to trade in Sukuk and bonds through Al Jazira Capital website for trading “Tadawulcom”. Tadawulcom allows customers to purchase and sale sukuk, see prices directly online through a single screen that includes all investors requirements and execute purchase and sale orders with unprecedented flexibility, complete confidentiality and full security using a computer, tablet, or mobile app. It keeps investors in constant contact with the stock market news which will enable them to take trading decisions. In addition to that, Al Jazira Capital has experienced professional staff to execute orders by telephone,” Eng. Aba Al Khail clarified.

Eng. Aba Al Khail valued the Keenness of custodian of the Two Holy Mosques King Salman and His Crown Prince Prince Mohammed Bin Salman, may Allah preserve them, on the happiness and well-being of citizens and building a strong economy with the characteristics of advanced economies. He expected that these decisions will contribute to motivating community members from different segments to increase their investment in the government debt instruments. Eng. Aba Al Khail emphasized the importance of increasing citizens awareness about saving and investment since sukuk is considered one of the best guaranteed and risk-free investment. He considered that the government's payment of zakat and income tax on government sukuk issued by the Ministry of Finance will boost domestic and international investment in it.

 “The decision came to confirm that the citizens are the focus attention of our wise leadership who keens to open the way for its citizens to participate in supporting development projects. As well as, a continuation of the wise policy the government follows for the welfare, stability and security of the citizen, and to achieve development programs within the framework of the Financial Sector Development Program, one of the most important programs of "Vision 2030",” Eng. Aba Al Khail added.