PIF anchors newly-introduced Saudi bond ETF with SAR 750M

The Public Investment Fund (PIF) pumped SAR 750 million (or $200 million) in investments in the recently-launched SPDR JPMorgan Saudi Arabia Aggregate Bond UCITS ETF — a new bond ETF focused on Saudi Arabia, managed by State Street Global Advisors Co.

In a statement picked up by Argaam today Jan. 8, State Street explained that the new fund is the first Saudi fixed-income index fund to be listed in Europe, being listed on the London Stock Exchange (LSE) and Deutsche Börse’s Xetra (Primary).

The ETF, which provides exposure to a diversified basket of dollar-denominated, SAR-denominated government and quasi-government bonds, including sukuk, will track the newly-created JPMorgan Saudi Arabia Aggregate Index.

The ETF is available to investors in Austria, Denmark, France, Finland, Germany, Italy, Luxembourg, Netherlands, Norway, Spain, Sweden and the UK.

The ETF’s roll-out is deemed a key step in the context of PIF’s efforts to enable greater international access to the Saudi capital market, with opportunities to attract foreign investments, State Street added.

The PIF’s new "significant commitment" — through which it has taken a majority stake in the ETF, acting as an anchor investor — came as many international investors have "a genuine appetite to invest in Saudi Arabia and its capital market, thanks to its favorable maturity and growth, supported by the Kingdom's ambitious Vision 2030 economic transformation plan.