GCC fixed income market sees $51.5bn in primary issuances in Q1

20/04/2025 04:27 AST

The primary debt issuances of bonds and sukuk in the GCC countries amounted to $51.51 billion through 125 issuances during the first quarter of 2025, down 7.1% from the same quarter last year, where issuances in Q1 2024 stood at $55.5 billion, according to Kuwait Financial Centre (Markaz).

Saudi-based issuances led the GCC during Q1 2025, raising $31.01 billion through 46 issuances, down from $38.55 billion in Q1 2024 a decrease of 19.6%, and representing 60.2% of issuances during the year, stated Markaz in its Fixed Income Report.

UAE- based issuances ranked second, with $10.17 billion through 29 issues, representing 19.7% of the market, an increase of 61.6% from the same quarter last year.

Qatari entities were the third largest issuers in terms of value, with $7.14 billion issued through 38 issuances, representing 13.9% of the issuances over the quarter.

Bahraini issuers follow, with a total issuance size of $1.53 billion through 2 issuances, a 44.5% decrease from the same quarter last year.

Kuwaiti issuances recorded a 40.7% increase from the same quarter last year, recording a total value of $1.41 billion through 9 issuances.

Omani entities recorded the lowest value of issuances during the year, with $260 million raised through 1 issuance, representing 0.5% of the total value of issuances.

According to Markaz, the total GCC corporate primary issuances increased by 45.3% from Q1 2024, amounting to $32.12 billion raised, compared to $22.11 billion raised in Q1 2024.

Corporate issuances represented 62.4% of total issuances for Q1, contrasting with the preference of issuances last year where more sovereign entities raised capital (Corporate issuances Q1 2024: 39.9%).

Government related corporate entities raised a total of $6.8 billion in Q1 2025, representing 21.2% of all corporate issuances. Total GCC sovereign primary issuances decreased by 41.8% in Q1 2025, raising $19.39 billion throughout the year, representing 37.6% of total issuances.

On the conventional issuances, Markaz said it increased by 15.8% in Q1 2025 compared to Q1 2024, raising a total of $33.76 billion for the quarter.

Sukuk issuances decreased by 32.5% in Q1 2025, resulting in a total value of $17.75 billion for the quarter.

As for issuer preferences, Q1 2025 saw an increased appetite for conventional bond issuances in the GCC, representing 65.5% of total issuances for the quarter. This follows the same trend as in Q1 2024, where conventional bonds also represented the bulk of issuances, with 52.6% of all issuances in Q1 2024 being conventional bonds.

According to Markaz, the Financial sector led the bond and sukuk issuances in Q1 2025, with total value of $22 billion through 100 issuances representing 42.8% of total issuances followed by Government issuances with $19.4 billion through 12 issuances, representing 37.6% of total issuances.

This represents an increase for the financial sector (23.6%) and a decrease for government issuances (-41.8%) when compared to the same period last year, it stated.

The real estate sector was on the third spot with $4.3 billion through 5 issuances representing 8.3% of total issuances, with the remaining sectors together representing a small portion of total issuance (11.34%).

Markaz pointed out that US Dollar-denominated issuances led the GCC bonds and sukuk primary market in Q1 raising a total of $44.9 billion through 92 issuances, representing a substantial 87.2% of the total value raised in primary issuances during the year.

The second largest issue currency was the Euro, where Euro denominated issuances raised a total of $3 billion through 4 issuances.

As for currencies bucketed under "Other" which totaled $1 billion, the Hong Kong Dollar (HKD) represented 0.83% of total issuances with a total value of $428 million through 12 issuances, it added.

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