Riyadh, Kingdom of Saudi Arabia: The Saudi Real Estate Refinance Company (SRC), a wholly owned company of the Public Investment Fund (PIF), today signed a partnership agreement with Arab National Bank (ANB). The partnership agreement is aimed at providing long-term liquidity in the housing financing market to boost the rate of Saudi homeownership to 70% by 2030, in line with the objectives of the Vision 2030 housing programme.
The agreement with ANB, the latest among several partnerships with banks and real estate finance companies operating in the Kingdom, further testifies SRC’s strategic objectives of finding innovative ways to enable home financing originators to effectively manage risks, liquidity and capital adequacy requirements. SRC aims to promote the growth and stability of the real estate finance market by facilitating the provision of more affordable home financing options for Saudi citizens.
The partnership agreement was signed by SRC’s CEO Fabrice Susini and Obaid Abdullah Al-Rasheed, Managing Director and CEO of ANB. As per the terms of the agreement, SRC will purchase a significant portion of ANB’s housing finance portfolio and provide liquidity to ANB, which in turn provides greater homeownership opportunities for over two million of the bank’s customers.
Fabrice Susini, CEO of SRC said: “Today’s agreement is a testament to SRC’s continuous efforts in supporting the housing market in the Kingdom by providing capital and risk management for banks. SRC will continue to cultivate partnerships to help realise the objectives of the housing programme, one of the Kingdom’s Vision 2030 programs, through facilitation of liquidity provision to originators and enabling affordability of home financing to Saudi families. Fostering such partnerships with real estate finance companies is a key pillar of SRC’s strategy which aims to increase sustainable financing opportunities to promote affordable housing and diversify financing options for Saudi families. Increasing the proportion of home ownership is in line with SRC’s goal of building a strong secondary market in the Kingdom.”
Engineer Salah Bin Rashid AlRashid, Chairman of the Board of Directors at ANB said: “We are proud of our partnership with SRC which will enable the bank to recycle the liquidity resulting from the sale process and inject it back into the real estate financing market. This will also stimulate the bank’s refinancing activity through capital and risk management tools and will expand the ever-growing base of beneficiaries who stand to gain from the bank’s financing solutions, enabling them to realise the dream of owning a first home. I am confident that our partnership with SRC will strengthen the bank’s position as an active member of the housing ecosystem striving to realize the homeownership goal of 70 percent in accordance with the Vision 2030.”
Earlier this year, SRC issued its largest government-backed sukuk worth SAR 4 billion and was oversubscribed by 2.15 times. In April, SRC received an ‘A2’ long term issuer credit rating from Moody’s and ‘A’ long term issuer credit rating from Fitch Ratings, highlighting its highly effective business model and a growing housing market in the Kingdom.
About Saudi Real Estate Refinance Company (SRC):
Fully owned by the Public Investment fund (PIF), the Saudi Real Estate Refinance Company (SRC) was established in 2017, after obtaining a license to operate in the secondary real estate market by the Saudi Central Bank, with the goal of transforming the local housing market.
SRC enables individuals and entities interested in direct or indirect real estate financing to increase and diversify origination of long-term fixed-rate (LTFR) products.
As one of its primary roles, SRC provides banks and real estate finance companies with liquidity or capital relief, enabling growth in the home financing sector to increase home ownership rates among Saudi citizens. SRC will subsequently aggregate and packages home financing portfolios into mortgage-backed securities to be sold to domestic and international investors.
With a world class management team drawing from international best practice, SRC is uniquely positioned to become the partner of choice for banks and non-bank lenders in the Kingdom.
For more information please visit: http://srco.com.sa/
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Saudi Real Estate Refinance Company (SRC)
About the Public Investment Fund (PIF):
The Public Investment Fund is one of the largest and most impactful sovereign wealth funds in the world, driving the economic transformation of Saudi Arabia for the benefit of its people while helping shape the future global economy. PIF is building a world-class portfolio through investments in attractive, long-term opportunities across diverse industries and asset classes internationally, while unlocking new sectors at home. PIF works alongside global strategic partners and renowned investment managers, and acts as the Kingdom of Saudi Arabia’s primary investment arm aiming toward generating long-term value for the Kingdom of Saudi Arabia in line with Vision 2030.
More information can be found at www.pif.gov.sa
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