The government of Oman has invited banks to participate in a $1 billion sovereign loan, two sources aware of the matter said on Sunday, as the Gulf country seeks funds at a time of stretched state finances due to lower oil prices.

The loan will be arranged by Citigroup, Gulf International Bank and Natixis and will run for five years, the sources said.

The interest rate on the loan will be 110 basis points over the London interbank offered rate (Libor), according to one of the sources, who added that marketing of the deal will close by the middle of December.

Oman's Finance Ministry did not immediately respond to a request for comment.-Reuters