Treasury

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Treasury

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We assist you in identifying sources of potential risk and in providing cost-effective solutions to risk positions.
 

Introduction

Choose from a range of structured solutions that will enhance returns from your business.

In today's fast paced international markets, financial risk management can often mean the difference between profit and loss for individuals and companies of all sizes. This risk can take many forms including those arising from foreign exchange, interest rates, balance sheet positions, or investment portfolios. Since risks are not immediately evident, choose the right partner to guarantee safe and risk-free business transactions.

At SAIB, we provide you with advice on managing your financial exposures as well as provide training and guidance on these new financial instruments.

Treasury Products

Money Market

SAIB offers a full range of call and fixed time deposits at competitive rates. Deposits can be structured to meet the individual's cash flow and cash management needs of our customers.

Foreign Exchange

All major international and Gulf currencies are available at competitive prices. We also make a market in less frequently traded currencies. Transactions may be taken on spot, forward, and swap markets with tenors up to one year. Foreign exchange hedging positions will be structured with forward exposures resulting from trade or capital investment positions.

Currency Options

Currency options are used for hedging purposes to manage existing or potential foreign currency cash flows. Unlike spot or forward foreign exchange contracts, option contracts convey the right rather than the obligation to make or take delivery of foreign exchange. The additional flexibility has increased the popularity of options to control foreign exchange exposure.

Murabaha Deposit

The SAIB Murabaha Deposit allows you to make a healthy profit on your money in a safe and Shariah-Compliant manner.
SAIB enters into a contract with you to invest your money in metals  at an agreed price. You make a profit by selling the metals at a future date at a higher price. read more...

Interest Rate Swaps

These are agreements between two parties to exchange future cash flows on a notional principal amount of the same currency. The cash flows are usually based on a fixed rate payment for one party and a floating rate payment for the other party. Interest Rate Swaps are useful in protecting balance sheets and investment portfolios from adverse fluctuations in interest rates. Swaps can be tailored to meet individual needs and are readily available in maturities out to five years.

Swaptions

Swaptions are options to enter into an interest rate swap. All conditions are the same as the interest rate swaps except for the swaption buyer. In return for the payment of an up-front premium, the buyer has the right but not the obligation to enter into an interest rate swap.

Forward Rate Agreements 

These are contracts in which two parties agree to fix an interest rate for a specific future period. For example, a six-month loan rate can be drawn down in three months. These instruments are usually used to protect positions from short-term interest rate risk. Maturities are readily available out to two years.

Interest Rate Caps, Floors and Collars

An Interest Rate Cap is an option agreement between the seller of the Cap and the buyer that on predetermined future rate reset dates, if an agreed upon index rate is above an agreed upon strike rate, the seller will pay the purchaser the interest differential on the notional principal amount. The buyer of the Cap is thereby assured that he will not have to pay above an agreed upon rate for an agreed upon period.

An Interest Rate Floor is an option agreement between the seller of the Floor and the purchaser stating that on predetermined rate reset dates, if an agreed upon index rate is below the strike rate, the seller will pay the purchaser the interest differential on the notional principal amount. The buyer of the Floor is thereby assured that he will not receive below an agreed upon rate for an agreed upon period.

Interest Rate Collars  are a combination of a Cap and a Floor whereby one option is purchased and the other is sold. The premium received from the sale of one option offsets the cost of the option purchased. This strategy provides less protection than the outright purchase of either a Cap or Floor, but at a lower cost.

Fixed Income and Money Market Securities

SAIB Treasury Investment manages a wide variety of securities for its own account. Its investments may include various international debt instruments such as US Treasury, US Agencies, European debt instruments, corporate bonds, GCC bonds, Saudi corporate bonds as well as Sukuk. As a principal, SAIB Treasury Investment, from time to time, may offer to sell or buy blocks of securities to the market in order to re-balance its Portfolio or Balance Sheet.

SAIB Treasury Department operates from 8am to 5 pm, from Monday to Thursday, and from 8 am to 4 pm on Friday and Sunday.We provide full twenty-four-hour coverage of risk positions through SAIB's international correspondent network.

Learn more by contacting us on: 
Telephone: +966 14761580/ +966 1 4792851
Fax: +966 1 4761976
SWIFT: SIBCSARI
Reuters: SAIB