RIYADH: Saudi Arabia’s Public Investment Fund has launched its first commercial paper program, introducing a new tool to diversify its funding sources and enhance short-term liquidity management.
A commercial paper is a debt instrument used to raise short-term funding, offering faster access to funds than traditional loans. It is widely used in global financial markets, offering PIF greater flexibility in meeting its needs while aligning with its dynamic investment priorities.
The CP program will enable PIF to issue short-term debt through offshore special-purpose vehicles, enhancing its liquidity management and complementing its long-term capital-raising initiatives.
According to a press release, the initiative, which includes US and Euro CP sub-programs, has received top-tier credit ratings of Prime-1 from Moody’s and F1+ from Fitch, underscoring its strong financial standing.
PIF has consistently demonstrated its ability to pioneer new financial instruments. In 2022, it became the first sovereign wealth fund globally to issue a green bond, including a landmark century green bond, followed by a successful $3.5 billion sukuk issuance, according to the fund.
