Saudi Arabia's sovereign wealth fund started taking orders for its debut dual-tranche Islamic dollar bond on Wednesday, in the first major test for Middle East markets since the sharp escalation of the Israel-Hamas conflict.
The Saudi Public Investment Fund (PIF) gave initial price guidance for the bonds of 150 basis points over U.S. Treasuries for its five-year tranche and 170 bps over the same benchmark for the 10-year tranche, banking documents showed.
PIF's Islamic bonds drew over $20 billion in demand, excluding interest from lead managers, a separate bank document showed.
"They’re looking pretty attractive from an investor’s point of view. For PIF, they probably are looking at higher costs given the current conditions," a fixed-income analyst said, taking into account that final pricing is often less generous.
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