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Emerging East Asia bonds can weather short-term risks, says ADB

KUALA LUMPUR, Nov 20 — Short-term risks continue to cast a shadow over emerging East Asia’s local currency bond markets but they should be able to weather the challenges so long as the region’s policymakers remain vigilant, says Asian…


Fitch affirms Sime Darby Plantation at BBB+ with outlook stable

KUALA LUMPUR, Nov 15 — Fitch Ratings has affirmed palm-oil producer Sime Darby Plantation Bhd’s (SDP) Long-Term Foreign-Currency Issuer Default Rating at BBB+ with a stable outlook and its senior unsecured rating at BBB+. At the same time, the…


RAM Ratings to withdraw MRCB Southern Link’s senior sukuk rating

PETALING JAYA: RAM Ratings said it will withdraw the rating of MRCB Southern Link Bhd’s (MRCBSL) RM845 million senior sukuk upon full settlement, following the toll concessionaire's termination and settlement deal with the government over the concession for the Eastern Dispersal Link Expressway (EDL) in Johor.

“MRCBSL is the funding conduit for the EDL’s construction. Its financial commitments are supported by back-to-back payments from MRCB Lingkaran Selatan. As such, we view both companies in aggregate from a credit standpoint,” RAM said in a statement.

RAM’s Infrastructure and Utilities Ratings co-head Davinder Kaur Gill said although it noted that the government has held back its plan to abolish industry-wide toll collections for now, the outcome of the EDL’s settlement negotiations is pivotal to the sector’s stakeholders.

He said this is because it will set the tone and serve as a benchmark deal for other potential toll abolitions in the future.

Under the termination and settlement agreement signed on Monday, the government agreed to pay the concession company approximately RM1.33 billion of compensation following the abolition of toll collections for the EDL since Jan 1, 2018, and the takeover of the EDL.

The cash settlement is expected to be paid within 14 days (or any other later date agreed) of submission of a performance bond in relation to outstanding works for the highway, as agreed under the termination and settlement agreement.

Part of the settlement proceeds will be utilised to fully repay all outstanding financing obligations under the senior sukuk, including any accrued and unpaid profit due as at the redemption date, RAM added.


Malaysia’s sukuk issuance exceeds projection for 2018

KUALA LUMPUR: RAM Ratings Services Bhd said Malaysia’s sukuk issuance as of end-September 2018 totalled RM123.9 billion, surpassing its earlier projection of RM100 billion–RM120 billion for the year. In a statement here, the rating agency said a total of RM24.9 billion sukuk was issued in the third quarter of 2018. The growth was led by […]


MRCB’s share price continues decline on EDL termination details

PETALING JAYA: Malaysian Resources Corp Bhd's (MRCB) continued its decline of Monday, trading 1.5 sen lower at 76 sen after announcing details of the deal with the government to terminate its Eastern Dispersal Link expressway concession.

The stock, which was on a uptrend post Budget 2019 when the Finance Minister, Lim Guan Eng announced that a deal had been struck for the termination of the Eastern Dispersal Link expressway, hit a low of 75 sen in early trade before rebounding to 76 sen with almost 11 million shares changing hands.

MRCB announced on Monday that it will use the RM1.33 billion from the government for the termination of the EDL concession, for repayment of senior sukuk, junior sukuk and shareholder advances, and as general working capital.

MRCB expects to see its net gearing improve to 0.28 times from 0.53 times as at Dec 31, 2017 (FY17). While earnings per share of the MRCB group is expected to increase from 6.56 sen to 7.50 sen as a result of the concession termination.


Malaysia retains spotlight as leading Islamic finance centre

KUCHING: Malaysia’s progress and maturity in the development of its Islamic finance eco-system is ahead of other Islamic finance markets. This observation was based on reports produced by RAM Ratings and the International Shari’ah Research Academy for Islamic Finance (ISRA) for the Standing Committee for Economic and Commercial Cooperation of the Organisation of Islamic Cooperation […]


MRCB to receive RM1.33b from govt for EDL concession termination

PETALING JAYA: Malaysian Resources Corp Bhd (MRCB) will receive RM1.33 billion from the government for the termination of the Eastern Dispersal Link Expressway (EDL) concession, and expects to see its net gearing improve to 0.28 times from 0.53 times as at Dec 31, 2017 (FY17).

MRCB intends to use the proceeds for the repayment of senior sukuk, junior sukuk and shareholder's advances, and as general working capital.

MRCB's sub-subsidiary MRCB Lingkaran Selatan Sdn Bhd entered into a termination and settlement agreement with the government today.

“Based on the audited consolidated financial statements of MRCB group for the FY17 and on the assumption that the concession termination had been effected at the beginning of that financial year, the earnings per share of the MRCB group is expected to increase from 6.56 sen to 7.50 sen as a result of the concession termination,” MRCB said in a stock exchange filing.

Net assets per share is expected to fall to RM1.10 from RM1.11.

To recap, MRCB had planned to dispose of the EDL following the government's decision to abolish toll collection on the highway from 2018. EDL is the first fullly private sector-funded highway that ran on a 34-year concession. The concession was awarded to MRCB in 2007.

The concession termination is subject to approval of MRCB shareholders at an EGM to be convened. MRCB has submitted an application to Bursa Malaysia Securities for a waiver from having to obtain shareholders' approval for the concession termination and the termination agreement and will seek shareholders' ratification at the EGM instead.

MRCB's substantial shareholders, namely the Employees Provident Fund Board, Gapurna Sdn Bhd and Lembaga Tabung Haji, which collectively hold at least a 51% stake in MRCB, will vote in favour of the concession termination and termination agreement at the EGM.

Barring unforeseen circumstances, and with all approvals being obtained, the concession termination is expected to be completed by the first quarter of 2019.


Renewable energy mix TNB’s way to tackle escalating cost

KUALA LUMPUR, Nov 11 — The Energy, Science, Technology, Environment and Climate Change Ministry is targeting to grow renewable energy’s (RE) proportion of generation mix from the current two per cent to 20 per cent by 2025-2030. This bodes well…


Budget 2019 set to restructure Malaysia’s fiscal position

KUCHING: The 2019 Budget is set to restructure Malaysia’s fiscal position through implementation of tough measures aimed at narrowing the fiscal deficit, while remaining focused on the need to accelerate economic growth and improve the well-being of the people. Franklin Templeton GSC Asset Management Sdn Bhd chief executive officer Hanifah Hashim said the government had […]


Budget 2019 set to restructure Malaysia's fiscal position, says Franklin Templeton

KUALA LUMPUR, Nov 9 — The 2019 Budget is set to restructure Malaysia’s fiscal position through implementation of tough measures aimed at narrowing the fiscal deficit, while remaining focused on the need to accelerate economic growth and improve…