J.P. Morgan announces stabilisation period for Alinma AT1 sukuk

J.P. Morgan Securities plc has been appointed stabilisation coordinator for Alinma AT1 Sukuk Limited's forthcoming USD benchmark perpetual non-call 5.5-year Additional Tier 1 mudaraba sukuk capital certificates, guaranteed by Alinma Bank and slated for listing on the London Stock Exchange's International Securities Market. The stabilisation period, commencing August 27, 2025, allows managers to support the market price through potential over-allotments up to 5%, though such actions are not guaranteed. This issuance represents a notable Sharia-compliant capital instrument entering the market, with the offer price yet to be determined.

Analysis

J.P. Morgan Securities plc has been appointed as the stabilisation coordinator for an upcoming issuance of USD benchmark perpetual non-call 5.5-year Additional Tier 1 (AT1) sukuk from Alinma AT1 Sukuk Limited, guaranteed by Alinma Bank. This indicates a significant new offering of Sharia-compliant bank capital targeted at international investors, as evidenced by its planned listing on the London Stock Exchange's International Securities Market and a minimum denomination of USD 200,000. J.P. Morgan, along with a syndicate of six other managers including Goldman Sachs, may conduct stabilisation activities, including over-allotments not exceeding 5% of the aggregate nominal amount. This mechanism, permitted under Market Abuse Regulation, is designed to support the security's market price for a period between August 27 and September 27, 2025, though these actions are not guaranteed. The transaction introduces new supply into the AT1 market, but key details, most notably the offer price, have not yet been determined.

Key Decisions for Investors

• Investors with an appetite for Sharia-compliant or emerging market financial credit should monitor the pricing of this AT1 sukuk, as its structure and the backing of a strong syndicate present a notable opportunity in the fixed-income space.
• Potential buyers should be aware that the price may be artificially supported during the initial stabilisation period ending September 27, 2025, and that this support is temporary and not guaranteed to occur.
• Given the instrument is a perpetual AT1 security, it is critical to evaluate the credit risk of the guarantor, Alinma Bank, and fully understand the loss-absorption and non-call features before investing.