April 4, 2015: Update on Saudi's biggest ever economic overhaul. The hammer is dropping.Tonight it's being reported that Saudi Arabia has taken out the $10 billion loan. CNBC is reporting:
The government is in talks with banks to raise about $10 billion through a syndicated loan, two people familiar with the matter said last month. While Al-Sheikh declined to confirm the details and the potential size of the deal, he said it will be followed by the kingdom’s first international dollar bond as early as September.“We’re doing it now because we actually don’t need the money but we want to prepare ourselves for the future to make sure that when we actually go to the markets and we really need the money, the markets, the investors, the financial institutions already know us."
Saudi Arabia is raising $10bn from a consortium of global banks as the kingdom embarks on its first international debt issuance in 25 years to counter dwindling oil revenues and reserves.
The landmark five-year loan, a signal of Riyadh's newfound dependence on foreign capital, opens the way for Saudi to launch its first international bond issue. It comes as the sustained slump in crude encourages other Gulf governments, such as Abu Dhabi, Qatar and Oman, to tap international bond markets.