ML-Implode News - Saudi Arabia Races Through Financial Toolkit to Raise Funds

In recent weeks, the kingdom raised a $10 billion loan, clamped down on currency speculators and informed banks of plans to raise as much as $15 billion in its first international bond sale, people with knowledge of the matter said. It's also said to be contemplating IOUs to pay contractor bills and hired HSBC Holdings Plc banker Fahad Al Saif to set up a new debt office.
The speed of the measures underscores Deputy Crown Prince Mohammed bin Salman's urgency to shore up the country's finances as an era of oil-fueled abundance falters. Though currency reserves remain strong -- among the world's largest -- net foreign assets are at a four-year low after declining for 15 months in a row and the kingdom may post a budget deficit of about 13.5 percent of economic output this year.
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Authorities are also taking steps to protect the currency regime amid speculation the country will have to abandon the riyal's three-decade-old peg to the U.S. dollar. Last week, the Saudi Arabia Monetary Agency ordered banks to stop selling dollar-riyal forward structured contracts immediately, following a similar order in January, people aware of the matter said.
Among those betting that the peg may not endure are U.S. hedge funds. PointState Capital's Zach Schreiber, who made $1 billion betting against oil two years ago, is wagering that weaker long-term crude prices and rising costs will cause the country to abandon the peg. Pershing Square Capital Management has made similar bets.

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Saudi Arabia Races Through Financial Toolkit to Raise Funds