Malayan Banking Bhd (Maybank) has received an overwhelming response from international investors resulting in an oversubscription rate of more than seven times for the world's first Islamic US dollar Subordinated Bank Capital Sukuk for US$300 million (RM1.03 billion).
In a statement yesterday, Maybank said strong appetite for the 10-year US dollar subordinated sukuk came from international investors, both Islamic and conventional, across Asia (61%), Middle-East (15%) and Europe (24%).
The issuance was jointly lead-managed by Aseambankers Malaysia Bhd, The Hongkong and Shanghai Banking Corporation Ltd's Offshore Banking Unit (Labuan) and UBS AG's Labuan branch acting through its business group, UBS Investment Bank.
Maybank said the company, led by its president and chief executive officer, Datuk Amirsham A Aziz, carried out a comprehensive international road show ahead of issuing the sukuk, starting on April 12.
It said the roadshow concluded with pricing and final allocations on Wednesday at the lowest end of the price guidance given to investors.
Maybank said the transaction achieved a number of pricing benchmarks, including the tightest pricing ever achieved on a US dollar issue from Malaysia to-date.
It also achieved the second-tightest pricing ever for a US dollar sub-debt bank issue from Asia (ex-Japan) and the tightest pricing ever for a US dollar Sukuk globally, excluding supranational issuers.
Maybank said the issuer for the transaction was MBB Sukuk Inc, a special purpose vehicle incorporated in Labuan. The US dollar subordinated sukuk was structured on a 10 non-call five-year basis and will qualify as Tier-2 Capital for Maybank.
It said as it was a subordinated issue, the rating assigned was Baa1 by Moody’s Investor Service, and BBB+ by both Standard & Poor’s Rating Services and Fitch Ratings Ltd.
The proceeds raised will be used to fund Maybank group’s Islamic banking operations and for general Islamic banking purposes.
Maybank deputy president and chief financial officer Datuk Mohammed Hussein said: "With this landmark issue and innovative structure, Maybank is indeed proud to once again demonstrate Malaysia’s leadership in global Islamic finance.”