Saudi Arabia Raises SR1.64 Billion Through September Domestic Sukuk Sale

Saudi Arabia has raised SR1.64 billion ($437 million) through its September riyal-denominated sukuk issuance, with the latest domestic sale divided into six tranches carrying maturities ranging from 2029 to 2041.

The National Debt Management Center said the largest tranche was valued at SR705 million and is due in 2041. The second-largest tranche amounted to SR650 million and matures in 2031.

The remaining portions included SR205 million due in 2029, SR50 million maturing in 2033, SR25 million due in 2036 and SR5 million with a maturity date in 2039.

The September issuance was significantly smaller than Saudi Arabia’s previous domestic sukuk sale in August, which raised SR9.52 billion through five tranches with maturities extending from 2031 to 2041.

The latest transaction comes as the Kingdom continues to pursue a diversified approach to government financing. Under its 2026 Annual Borrowing Plan, Saudi Arabia expects total financing needs of around SR217 billion this year.

Of that amount, approximately SR165 billion is intended to finance the projected budget deficit, while around SR52 billion is required to cover principal repayments on debt maturing during 2026.

The government has said it plans to balance borrowing between domestic and international markets. Its funding strategy includes public and private issuance of bonds, sukuk and loans, as well as project and infrastructure financing and support from export-credit agencies.

Saudi Arabia recorded a budget deficit of SR34.3 billion in the second quarter of 2026, according to government figures. The shortfall was considerably lower than the SR125.7 billion deficit reported in the first quarter, bringing the deficit for the first six months of the year to SR160 billion.

Public debt reached about SR1.69 trillion at the end of June, according to the Ministry of Finance’s quarterly budget performance report. The first-half deficit was financed through borrowing without using government reserves.

The domestic issuance followed Saudi Arabia’s $3.25 billion international sukuk sale earlier in September. The transaction consisted of a $1.25 billion five-year tranche maturing in 2031 and a $2 billion 10-year tranche due in 2036.

The international offering attracted orders worth about $16.5 billion, more than five times the amount offered, according to the National Debt Management Center.

The sale also came as Gulf borrowers returned to international sukuk markets following a period of conflict-related financial market volatility. Bloomberg reported that some issuers had turned to conventional bonds and other funding channels during the period of uncertainty.

The Islamic Development Bank, Arab National Bank and Kuwait International Bank later issued a combined $2.75 billion in sukuk, according to Bloomberg.