In a time where countless companies are preoccupied with rescheduling of their debts, Kingdom Installment Company (KIC), based in Riyadh, surprised the international capital markets by redeeming its maiden Sukuk issued in 2006. The Sukuk, attracting investors from Europe, Far East and Gulf countries, were credit enhanced by the International Funding Corporation (IFC), member of the World Bank Group, and backed by real estate lease contracts developed by Dar Al Arkan Real Estate Development Company (Dar Al Arkan) based in Saudi Arabia. The Sukuk was structured in line with the provisions of the Islamic Shari'ah and issued with the purpose of leveraging the company's financing capabilities to provide home-buyers within the Kingdom with funds to purchase their homes in return for affordable monthly installments. Hathloul Al Hathloul, general manager of the KIC, stated that the company, previously a funding unit subsidiary of Dar Al Arkan, launched its credit business in 1998. It provided more than 5,000 Saudis with the required funding to purchase housing units from Dar Al Arkan through a leasing scheme. This laid down a solid foundation for KIC as the first Saudi company to issue Islamic Sukuk in the international capital markets and thus, securing funds for home-buyers to purchase homes from a real estate development company through mortgage financing. Hathloul added that the Sukuk redemption by the KIC reflects both the strength of the Saudi economy in general, as well as, the Kingdom's real estate sector. It illustrates remarkable confidence in the Saudi market by international investors. __
