Gulf International Bank B.S.C. announces the successful pricing and closing of a 3-year US$300 million Sukuk-al-Murabaha private placement

Press release
Published December 8th, 2011 - 05:36 GMT
Yahya Alyahya, GIB’s CEO
Yahya Alyahya, GIB’s CEO

Gulf International Bank (GIB) is pleased to announce the successful pricing and closing of a 3-year US$300 million Sukuk-al-Murabaha private placement (the Sukuk). The Sukuk certificates will pay a profit rate of 6-month USD LIBOR + 130 bps on a semi-annual basis, and will mature on 7th December 2014. The Sukuk offering was successfully placed with a number of institutional investors, with J.P. Morgan acting as Sole Manager of the placement.

Commenting on the successful closing of the placement, Dr. Yahya Alyahya, GIB’s CEO, said it reflected the investor community’s confidence in GIB’s credit strength and unique positioning in the GCC banking sector as one of the region’s premier financial institutions.

Dr Alyahya added: "We are delighted with the successful closing of our inaugural placement in the Islamic Sukuk market, and securing an attractive pricing despite the volatile market backdrop. This transaction confirms GIB’s commitment to diversify its funding sources by tapping into new pockets of liquidity such as the Islamic Sukuk market, and utilise innovative funding structures to achieve the lowest possible cost of funding for GIB. The funds raised will allow us to refinance our existing term finance maturities, further diversify our investor base and provide the resources to progress our business strategy. The Sukuk private placement represents further progress in GIB’s programme to more closely align the maturity profile of its assets and liabilities and reduce its previous reliance on short-term wholesale deposits.”

GIB is a leading bank in the Middle East with its principal focus on the Gulf Cooperation Council (GCC) states. The Bank is owned by the six GCC governments, with the Public Investment Fund of Saudi Arabia holding a majority stake (97.2 per cent). In addition to its main subsidiary Gulf International Bank (UK) Ltd., the Bank has branches in London, New York, Riyadh and Jeddah, in addition to representative offices in Beirut and Abu Dhabi.

Background Information

Gulf International Bank

Gulf International Bank B.S.C. (GIB) was established in the Kingdom of Bahrain in 1975, and commenced operations in 1976. In 2017, GIB became the first foreign domiciled bank to be granted approval from the Saudi Arabia Council of Ministers to establish a local commercial bank in the Kingdom of Saudi Arabia.

Consequently, GIB's branch offices in the Kingdom will become part of the Saudi Arabian subsidiary, with the country headquarters located in Al Dhahran.

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