Saudi Banks Are on Risky Debt Spree to Keep Funding Gigaprojects

Saudi Arabia’s banks are rushing to issue risky debt as the kingdom grapples with the mammoth spending demands of building a futuristic new city and hosting global sporting events.

Lenders including Al Rajhi Bank and Banque Saudi Fransi have sold more than $5.6 billion in Additional Tier 1 bonds so far this year — already reaching an annual record for the country — as lenders look to free up capital for so-called gigaprojects. That’s made Saudi Arabia the second-biggest source of AT1 supply in major currencies globally in 2025, based on data compiled by Bloomberg.