DUBAI: Saudi Arabia has chosen Citigroup , HSBC and JP Morgan to manage its debut sovereign bond issue, two sources with knowledge of the matter said on Sunday, in what could be one of the largest-ever emerging market debt offerings.

The kingdom is turning to international debt markets to help plug a budget shortfall caused by the fall in oil prices in the last two years. It ran a record deficit of nearly $100 billion in 2015, with another substantial fiscal gap due this year.

The Saudi offering is expected to be about the same as the largest-ever emerging market debt sale - Argentina’s $16.5 billion issue in April - and larger than Qatar’s $9 billion deal in May, currently the largest bond from the Gulf.

A spokesman for the Finance Ministry declined to comment.

The trio of banks have been chosen as global coordinators of the transaction, according to one of the sources, who spoke on condition of anonymity because the information isn’t public.

That means more banks are likely to be added to the roster, in other roles such as bookrunner, before the sale.

Banks had pitched for roles on the transaction earlier this month, with those which had participated in the kingdom’s $10 billion loan considered most likely to secure roles on the bond.

HSBC and JP Morgan coordinated that loan, along with Bank of Tokyo-Mitsubishi UFJ. Citigroup provided funding for the facility.

The timing of the transaction is likely to be after the summer, given the start of the Muslim holiday of Eid al-Fitr at the start of July, which will last for around 10 days in the kingdom. Global markets are still extremely volatile after Britain’s decision to withdraw from the European Union.

When Saudi Arabia does approach the market, it is expected to structure the deal with a tranche lasting for five years and another running for 10 years, the second source said.

The transaction is likely to be the first of many to help deal with the Saudi budget shortfall. It has been issuing domestic bonds worth 20 billion riyals ($5.33 billion) a month since last August.—Reuters