S&P Global Ratings believes that Saudi issuances have risen 37% in calendar year 2021. Saudi companies and government raised USD $36.9 billion sukuk in 2021, compared to USD $27 billion in 2020 and USD $28.6 billion in 2019.
In 2021, while the global sukuk issuance reached USD $147.4 billion compared with USD $148.4 billion in 2020, foreign-currency denominated sukuk issuance increased by 10%. Jumbo issuances in Saudi Arabia (for example the Saudi Aramco Sukuk) have contributed to this increase along with continued issuance growth in Malaysia, Indonesia, and–to a lesser extent–Turkey, due to favorable market conditions and ample liquidity. The issuance of capital boosting instruments by some of the GCC banks seeking these same favorable conditions also provided a boost. We expect the volume of issuance in 2022 to hover around $145-150 billion and believe that the implementation of national transformation plans such as the Saudi Vision 2030 will lead in some opportunities for sukuk issuances.
S&P sees also opportunities created by the energy transition in core Islamic finance countries, higher ESG awareness from regional issuers, and stronger automation using fintech solutions as likely to support future sukuk market growth. For instance, in Jan 2022 Saudi National Bank issued a $750 million sustainable sukuk.