RIYADH: In order to improve short-term liquidity management and diversify its funding sources, the Public Investment Fund of Saudi Arabia has started its first commercial paper program. Compared to typical loans, commercial papers provide quicker access to capital and are a financial product used to generate short-term finance. Its widespread usage in international financial markets gives PIF more adaptability in fulfilling its requirements and coordinating with its ever-changing investment preferences.
PIF will be able to issue short-term debt through offshore special-purpose entities thanks to the CP program, which will improve its liquidity management and support its long-term capital-raising efforts. A news statement states that the initiative, which consists of US and Euro CP sub-programs, has been given top-tier credit ratings of F1+ by Fitch and Prime-1 by Moody’s, highlighting its sound financial status.
PIF has continuously shown that it is capable of inventing innovative financial products. According to the fund, it successfully issued $3.5 billion in sukuk in 2022, making it the first sovereign wealth fund in the world to issue a green bond, including a historic century green bond.
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