KUALA LUMPUR: CIMB Group Holdings Bhd's Islamic banking unit, CIMB Islamic Bank Bhd had completed the issuance of RM250 million Tier 2 junior Sukuk on April 21 which was priced at 4.2% per annum.
'The AA1-rated Junior Sukuk with a maturity of 10 years is callable at year five and on each subsequent distribution date. Priced competitively at 4.2% per annum, the Junior Sukuk is not subject to any step up distribution rate after the call date,' it said on Thursday, April 28.
On April 14, CIMB Group also completed the issuance of a RM500 million 5-year medium term note (MTN), to refinance existing credit facilities. The MTN, rated AA1 by RAM, pays a coupon of 4.2% per annum.
"Both the Junior Sukuk and the MTN received overwhelming responses from investors, with both issuances about three times subscribed. The final pricing of 4.2% per annum for both issuances is very attractive, at approximately KLIBOR + 0.15%. The current market environment remains very conducive for corporate issuers including banks to tap the fixed income markets,' said CIMB Group deputy CEO and treasurer Datuk Lee K Kwan.
CIMB Bank Bhd had earlier secured several US dollar term loan facilities for tenures of three and four years on an unsecured floating rate basis, with all-in pricing of 0.90%-0.98% per annum above LIBOR. The loans will refinance maturing US Dollar liabilities with long term facilities at attractive costs.
"Current market conditions in the ringgit debt markets and the US Dollar loan markets are highly conducive to reducing liquidity risks in the balance sheet through the replacement of short term funding facilities with longer tenor liabilities at highly competitive credit spread in addition to capital fund raising at very efficient pricing levels. We constantly look for the cheapest sources of funding and capital to maintain our net interest margins," he said.
'The AA1-rated Junior Sukuk with a maturity of 10 years is callable at year five and on each subsequent distribution date. Priced competitively at 4.2% per annum, the Junior Sukuk is not subject to any step up distribution rate after the call date,' it said on Thursday, April 28.
On April 14, CIMB Group also completed the issuance of a RM500 million 5-year medium term note (MTN), to refinance existing credit facilities. The MTN, rated AA1 by RAM, pays a coupon of 4.2% per annum.
"Both the Junior Sukuk and the MTN received overwhelming responses from investors, with both issuances about three times subscribed. The final pricing of 4.2% per annum for both issuances is very attractive, at approximately KLIBOR + 0.15%. The current market environment remains very conducive for corporate issuers including banks to tap the fixed income markets,' said CIMB Group deputy CEO and treasurer Datuk Lee K Kwan.
CIMB Bank Bhd had earlier secured several US dollar term loan facilities for tenures of three and four years on an unsecured floating rate basis, with all-in pricing of 0.90%-0.98% per annum above LIBOR. The loans will refinance maturing US Dollar liabilities with long term facilities at attractive costs.
"Current market conditions in the ringgit debt markets and the US Dollar loan markets are highly conducive to reducing liquidity risks in the balance sheet through the replacement of short term funding facilities with longer tenor liabilities at highly competitive credit spread in addition to capital fund raising at very efficient pricing levels. We constantly look for the cheapest sources of funding and capital to maintain our net interest margins," he said.
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