A bumper bond programme from the government of Saudi Arabia could push local companies into the dollar bond markets if Saudi banks load up on government debt, suggest analysts at credit rating agency Standard & Poor’s.

S&P published a report on September 2 titled Assessing the effects of the Saudi government's debt issuance program on the domestic banking system. In it, the agency's Dubai-based analysts wrote that a three-tranche, SAR20 billion issue from the Saudi Arabian government in August and further issues expected in the coming months will be easily absorbed by local banks, which have so far bought much of the paper.