SME BANK’S MAIDEN SUSTAINABILITY SUKUK REGISTERS FINAL ORDER OF RM1.78 BLN

KUALA LUMPUR, July 24 -- SME Bank’s maiden sustainability sukuk wakalah programmes have registered a final order of RM1.78 billion in its book-building exercise, translating to 3.56 times bid-to-cover from the target issuance of RM500 million.

Group president/chief executive officer Aria Putera Ismail said taking into account the challenging market situation, the bank had managed to price the issuance at a very competitive rate of 3.10 per cent.

“Interestingly, this sustainability sukuk has received an overwhelming demand not only from domestic institutional investors but also from foreign asset managers and the investors’ profile is quite diversified and well supported by financial institutions, fund management companies, insurance companies and government-linked companies,” he said in a statement. “This high demand is also driven by awareness movements within and outside the country that continue to support balanced and sustainable development, which is the main focus of SME Bank’s sustainability sukuk.” 

Aria said with the issuance of the sustainability sukuk, the bank will now be able to offer more innovative financing solutions for small and medium enterprises (SMEs) and continue to play its role in ensuring their success and becoming the nation’s engine of growth.

“In general, the banking sector, being an entity that is highly integrated with all aspects of economic activities, can act as a game changer in promoting awareness amongst SMEs on the importance of applying the principles of environment, social and governance (ESG) in their business operations,” he added.

The SME Bank sukuk wakalah programmes are made up of the Islamic medium-term notes (IMTN) programme of up to RM3.0 billion (which includes the sustainability sukuk) and the Islamic commercial papers (ICP) programme of up to RM1.0 billion with a combined limit in nominal value of up to RM3.0 billion.

 This first non-government guarantee sukuk wakalah programmes for SME Bank have been accorded AAA ratings by MARC and also the gold standard for its sustainability sukuk framework, its highest rating.

-- BERNAMA