The Saudi Real Estate Refinance Company (SRC), a PIF company, has announced the launch of its second Residential Mortgage-Backed Securities (RMBS) issuance, marking a significant step in the development of the Kingdom’s securitization market. It is the first domestic issuance of its kind to receive published credit ratings from Moody’s Ratings and Fitch Ratings.
The issuance marks an important evolution in the development of the Kingdom’s secondary real estate finance market, moving from the establishment of a new investment asset class to strengthening its credit framework and providing an independent assessment of its risks. This enhances transparency, broadens institutional investor participation and strengthens the integration of the real estate finance ecosystem with capital markets.
This development builds on SRC’s inaugural issuance in August 2025, which helped establish a domestic model for securitizing residential mortgage financings and connecting financing portfolios with capital markets. The new issuance adds an institutional credit dimension to that model, supporting the development of a sustainable and scalable issuance market and providing a foundation for the continued development of this investment asset class in the Kingdom.
In this context, H.E. Majed bin Abdullah Al-Hogail, Minister of Municipalities and Housing and Chairman of SRC, emphasized that developing the secondary real estate finance market is a key pillar in improving the efficiency of the housing finance ecosystem by broadening sources of long-term liquidity, diversifying investment instruments and strengthening the link between real estate finance and capital markets.
H.E. Al-Hogail said: “This issuance builds on ongoing efforts to develop a more advanced and sustainable real estate finance market, underpinned by a diverse range of financing instruments, clear credit frameworks and a broader investor base. The progress achieved demonstrates the ability of the Kingdom’s financial ecosystem to develop new investment instruments that support the growth of the housing sector, improve capital allocation efficiency and create broader opportunities for institutional investment.”
Al-Hogail added: “Developing the secondary real estate finance market goes beyond providing liquidity; it is about building a more integrated ecosystem that enables real estate finance providers to manage their capital efficiently, supports sustainable funding sources and strengthens the sector’s ability to meet growing housing needs. We will continue to reinforce the foundations of this market and expand its growth opportunities, in line with the continued development of Saudi Arabia’s capital markets and in support of the objectives of Saudi Vision 2030.”
The second issuance is backed by a portfolio of residential mortgage financings worth approximately SAR 420 million, originated by six different financing institutions.
Fitch Ratings assigned the securities an AAAsf(sau) rating on its National Rating Scale, with a Stable Outlook, while Moody’s Ratings assigned an Aaa.sa (sf) rating on its national scale. Both ratings represent the highest rating category available under each agency’s respective national rating scale.
These ratings provide an independent credit assessment of the securities, enhancing the transparency of the issuance and the comparability of its credit characteristics. They also support institutional investor confidence in the asset class and help broaden participation in the domestic securitization market.
Commenting on the issuance, Majeed bin Fahd Al-Abduljabbar, Chief Executive Officer of SRC, said: “The second issuance builds on the foundation established by the inaugural issuance in creating a domestic model for the securitization of residential mortgage financings. It adds independent credit ratings that provide greater clarity on the characteristics of the underlying assets and enable them to be assessed against established credit standards.”
Al-Abduljabbar added: “The residential mortgage portfolio is worth approximately SAR 420 million and comprises financings originated by six different financing institutions. The diversity of asset originators, together with the credit ratings, supports the continued development of this class of securities and enhances its suitability for institutional investment.”
He explained that the issuance supports SRC’s efforts to provide long-term funding sources to real estate finance providers, enhance their available liquidity and improve capital management efficiency, thereby supporting the sustainability of residential real estate finance and the continued development of the Kingdom’s secondary market.
The issuance forms part of SRC’s strategy to develop a sustainable RMBS market, broaden the investor base and develop financing instruments that enhance long-term liquidity and support the integration of the secondary real estate finance market with Saudi Arabia’s capital markets.
The Saudi Real Estate Refinance Company (SRC) was established by the Public Investment Fund (PIF) in 2017 to develop Saudi Arabia’s mortgage finance market. It operates under a license from the Saudi Central Bank (SAMA) to facilitate mortgage refinancing. SRC plays a key role in achieving the objectives of the Housing Program under Saudi Vision 2030, which aims to increase homeownership rates among Saudi citizens. The company supports this goal by providing liquidity to lenders, enabling them to offer affordable housing finance to individuals. Additionally, SRC works closely with partners to strengthen Saudi Arabia’s housing ecosystem.
