DUBAI: Saudi Arabia’s government has contacted banks to sell them about 20 billion riyals ($5.34 billion) of bonds in its domestic debt sale this month, which will be allocated next week, the Maaal financial website reported on Thursday, quoting unnamed sources. Since last August, the government has been selling around 20 billion riyals of domestic bonds to banks every month to fund a budget deficit caused by low oil prices.
The finance ministry did not respond to a phone call seeking comment. This month’s domestic debt sale will comprise five-, seven- and 10-year bonds in fixed- and floating-rate tranches, Maaal said.
The fixed-rate bonds would be offered at 64-69 basis points above U.S. Treasuries for the five-year tranche, 76-81 bps over for seven years and 89-94 bps over for 10 years. The floating-rate bonds would be offered at 25-30 bps below the three-month Saudi interbank offered rate for five years, 10-15 bps below for seven years and flat to 5 bps above for 10 years.
