Saudi Real Estate Refinance Co (SRC), a subsidiary of sovereign wealth fund Public Investment Fund, said on Saturday it had agreed to buy SAR750m ($200m) worth of mortgages from local banks and mortgage financing companies.
The move comes after SRC recently completed a SAR750m sukuk issue with multiple tenors, under a programme that allows it to issue up to SAR11bn of local currency denominated Islamic bonds.
SRC, formed in 2017, is trying to boost the kingdom’s secondary mortgage market. It aims to refinance 20 per cent of Saudi Arabia’s mortgage market over the next decade. The agreements, signed on the sidelines of the Financial Sector Conference in Riyadh last week, included deals to buy portfolio of mortgages from Saudi British Bank and Banque Saudi Fransi, it said in a statement.
SRC’s chief executive told Reuters last week that the company aims to issue up to SAR4bn ($1.07bn) of long-term sukuk this year, as it prepares to purchase more home loan portfolios from mortgage financing companies and banks.