Bank Islam, PAAB Ink MoU To Channel RM100 Mln Financing For Contractors

KUALA LUMPUR, Nov 6 (Bernama) -- Bank Islam Malaysia Bhd has inked a memorandum of understanding (MoU) with Pengurusan Aset Air Bhd (PAAB) to provide RM100 million financing to PAAB contractors in 2026.

In a joint statement, both companies said the collaboration aims to enhance access to tailored financing and banking solutions for PAAB’s contractors, enabling them to execute awarded contracts more effectively and unlock their growth potential.

They said the MoU would facilitate the financing and implementation of water-asset works, which in turn can accelerate the reduction of non-revenue water and help deliver other 13th Malaysia Plan (13MP) and Budget 2026 water-related initiatives.

“(These initiatives include) sustainable infrastructure investment, improved service reliability, and environmental, social and governance (ESG)-aligned funding,” they said.

Bank Islam group chief business officer of institutional banking Sharifah Sarah Syed Mohamed Tahir said the MoU reflects the bank’s strategic commitment to support national ESG priorities while unlocking significant growth opportunities in the water sector.

“With RM100 million in targeted financing for PAAB contractors in 2026, we are positioning ourselves to play a pivotal role in financing sustainable development.

“Beyond financing, this partnership provides customers with faster and more reliable access to working capital through direct contract verification and PAAB’s assignment of payment mechanism,” she said.

Sharifah Sarah added that the collaboration enhances transparency, streamlines processes, and supports timely project delivery by ensuring efficient fund flow across the supply chain.

The MoU signing ceremony was attended by Deputy Energy Transition and Water Transformation Minister Akmal Nasrullah Mohd Nasir, with the agreement being signed by Bank Islam group chief executive officer (CEO) Datuk Mohd Muazzam Mohamed and PAAB CEO Zulkiflee Omar.

Commenting on the deal, Zulkiflee said the company believes the MoU represents an innovative approach to supporting vendor development by strengthening business sustainability.

“It enables us to bridge the financial gaps faced by our vendors through tailored financing solutions that help them maintain steady cash flow and ensure the smooth implementation of their projects within the stipulated timeline,” he said. 

-- BERNAMA