Issuance of Debt Instruments through Special Purpose Entities

In the Name of Allah, the Most Gracious, the Most Merciful Saudi Central Bank Head Office

General Directorate for Supervision of Finance Companies

Reference No.:	46911 / 99
Date:	1440/07/26
Attachments:	None

Circular

Dear Sirs, Peace, mercy, and blessings of God be upon you,

Subject: Regarding the Issuance of Debt Instruments by Finance Companies through Special Purpose Entities.

Pursuant to Article 14 of the Finance Companies Supervision System, which stipulates: "Without prejudice to what is stipulated in Article 3 of this System, a finance company may, in accordance with what the Executive Regulations specify and commensurate with its assets and financial position, issue securities and sukuk in accordance with the provisions of the Capital Market Law and its Executive Regulations." And pursuant to Article 66 of the Executive Regulations of the Finance Companies Supervision System, which stipulates that "finance companies may issue securities after obtaining a letter from the Bank indicating no objection." And in reference to the ongoing coordination between the Bank and the Capital Market Authority regarding the issuance of debt instruments by finance companies through special purpose entities.

The Bank wishes to inform you that finance companies may submit an application to the Capital Market Authority to establish a "Special Purpose Entity" in accordance with the rules governing special purpose entities issued by the Capital Market Authority, provided that the Bank is notified thereof. The Bank also wishes to emphasize the necessity of obtaining the Bank's prior no-objection letter before issuing any debt instruments through the special purpose entity.

Yours sincerely,

Fahd bin Ibrahim Al-Shathri Deputy Governor for Supervision

Distribution Scope

• Finance companies operating in the Kingdom

P.O. Box 2992, Riyadh 11169, Phone: +966 4662020, Fax: +966 4662488