- The agreements included deals with Banque Saudi Fransi and Saudi British Bank (SABB)
- The company aims to inject liquidity into the Saudi housing finance market by buying out mortgages
LONDON: The Saudi Real Estate Refinance Co. (SRC) said on Saturday it had agreed to buy SR750 million ($200 million) worth of mortgages from local banks and mortgage financing companies.
The agreements, signed during last week’s Financial Sector Conference in Riyadh, included deals with Banque Saudi Fransi and Saudi British Bank (SABB), SRC said in statements.
The company, a subsidiary of Saudi Arabia’s Public Investment Fund (PIF), aims to inject liquidity into the Saudi housing finance market by buying out mortgages.
“This announcement validates SRC’s purpose within a vibrant housing market, but for it to reach full potential we must ensure that there is improved supply of new homes whilst also making these homes affordable and accessible to more Saudi citizens,” SRC’s CEO Fabrice Susini said of the Banque Saudi Fransi deal.
“This agreement is a visible demonstration of how SRC makes further liquidity being available for the Saudi housing market which will ultimately make every Saudi citizen’s dream of owning a home a reality. That said, the agreement will further increase Banque Saudi Fransi’s ability to offer more (accessible) home buying solutions.”
David Dew, managing director of SABB, said: “This agreement will play a role in the development of the housing sector and the provision of sustainable solutions that will enable home ownership with ease. Housing finance is a central objective of Vision 2030, and with this initiative, SABB will be playing a central role on the development of the sector.”
The announcement comes shortly after SRC successfully completed sukuk, or Islamic bond, issuances of SR750 million, making it the first non-sovereign issuer in Saudi Arabia in 2019.
SRC, which was formed in 2017, aims to refinance 20 percent of Saudi Arabia’s mortgage market, which is forecast to grow to SR500 billion by 2020 and SR800 billion within the next decade.
Susini told Reuters last week that the company aims to issue up to $1.07 billion of long-term sukuk this year, as it prepares to purchase more home loan portfolios.