New Straits Times
Saudi Arabia raising loan size to US $16b
RIYADH: Saudi Arabia is increasing a US$10 billion (RM39.3 billion) syndicated loan by US$6 billion as the country steps up borrowing to plug a budget deficit.
Existing holders and new banks showed “an exceptional response”, said the finance ministry debt management office on Friday.
The new US$16 billion loan will be priced “at a margin representing a 30 per cent reduction from levels set in 2016”, it said.
The world’s biggest oil exporter plans to borrow about US$31 billion this year to bridge an expected budget deficit of US$52 billion and fund growth plans after its economy shrank last year. Saudi Arabia raised about US$36 billion last year, including US$14 billion of domestic bonds and US$22 billion from international debt markets.
The terms are a “recognition of the strengthening of the Saudi economy”, said Finance Minister Mohammed Al Jadaan.
The debt office is currently finalising the documentation process for the transaction and intends to close the financing by mid-March. A significant Islamic tranche will also be introduced in the deal, it said.