UPDATE 1-Saudi Arabia's biggest IPO 74 pct oversubscribed

(Rewrites with confirmation)

RIYADH, April 20 (Reuters) - Investors offered 18.3 billion riyals ($4.87 billion) or 74 percent more than Saudi Arabia's Alinma Bank was seeking in the country's biggest initial public offering, the bank and its IPO arranger said on Sunday.

Alinma sold 1.05 billion shares at 10 riyals each, raising 10.5 billion riyals in the IPO that ended on Wednesday, the bank and Samba Financial Group 1090.SE said in a statement.

The sale is equivalent to 70 percent of the bank's share capital.

"The number of subscribers stood at 8,853,000, with the total value of shares purchased reaching 18,273 million riyals, or 174 percent of the value of the total share offering," the banks said.

Alinma, which has yet to start business, will provide services -- such as project financing -- that comply with Islamic law.

Among other tenets, Islam forbids the payment of interest, equating it with usury, and instead offers investors a share of the profit or loss.

Saudi Arabia's economy is growing on a near six-fold increase in the price of oil during the last six years. The kingdom is the largest oil exporter.

Demand for financial services that comply with Islamic law is growing at twice the rate for conventional services, with the value of sharia-compliant assets worldwide at $700 billion, according to Moody's Investors Service. (For Reuters Islamic Finance content, click on ISLAMIC)) (Writing by Andrew Hammond; Editing by Quentin Bryar)