The Government of Malaysia’s recent issuance of MYR 500 million Sukuk Prihatin (Sukuk) to raise funds for COVID-19 recovery efforts has been touted as a positive move to support the economy, according to chief economists in the country.  According to Dr Anthony Dass, Chief Economist and Head of Research of AmBank Group, the Sukuk was considered an attractive means for investors to diversify their portfolio given that it was issued by the Government, and as such, was considered a risk-free asset or on par with Malaysian Government Securities and Government Investment...

A circular issued by the State Bank of Pakistan (SBP) on the 19th of August 2020 states that subsequent to the issuance of the first Ijarah Sukuk, the SBP will conduct an auction for the reopening of the existing Sukuk issuance, should the Government of Pakistan require additional funds. This is in place of issuing a new Sukuk entirely. According to the SBP’s circular, the Government has announced the reopening of the existing five-year Ijarah Sukuk, originally issued in July 2020 and set to mature in July 2025, in order to raise PKR 150 bil...

An estimated MYR 70.5 billion worth of moratorium on loan repayment has been granted by financial institutions in Malaysia from the 1st of April 2020 until the 7th of August 2020, according to Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz in a recently released report on the Implementation of the Prihatin Rakyat Economic Stimulus Package (Prihatin) and the National Economic Recovery Plan (Penjana).   Although the moratorium period is ending on the 30th of September 2020, Tengku Zafrul stated that banking institutions were ready to assist borrowers who wer...

Global Mediacom, the parent company of Media Nusantara Citra (MNC Media), will be issuing securities worth IDR 1 trillion. The issuance will comprise of Phase 1 Sukuk Ijarah worth IDR 300 billion, and Phase 1 Bond Issuance, which is part of Global Mediacom’s Sustainable Public Offering (PUB) II valued at IDR 700 billion. The proceeds of the issuance will be used for refinancing of existing IDR Sukuk Ijarah and Bonds from Global Mediacom 2017 Phase II, expected to mature on the 19th of September 2020, with an anticipated debt value of IDR 400 billion, with the remaining used as worki...

Etiqa Group (Etiqa), the insurance arm of Malayan Banking (Maybank), said they were still open to mergers and acquisitions (M&A) to expand their presence in the Association of Southeast Asian Nations (ASEAN), a strategy which would help create value, especially in the current economic climate.  According to Kamaludin Ahmad, Chief Executive Officer of Etiqa, in an exclusive interview to a local media outlet, Etiqa was on the lookout for potential M&A that would add value to the Group across ASEAN, adding that overseas bodies contributed around 30% to the...

Pakistan’s Long-Term Foreign Currency Issuer Default Rating (IDR) has been affirmed at B- by Fitch Ratings (Fitch), with a Stable Outlook.  The affirmation is based on Pakistan’s constrained public finances and dismal economic growth, indicated by large fiscal deficits and a high government debt to gross domestic product (GDP) ratio, which have been further exacerbated by the COVID-19 pandemic.  However, Fitch notes that Pakistan’s external finances appear resilient to the COVID-19 shock due to policy actions taken over the past few years by authoritie...

The United Arab Emirates (UAE) is striving to have the world’s fastest economic recovery as well as the most diversified and stable economy in the long term, according to His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai.  Speaking recently at a review of the UAE’s Ministry of Economy’s post-COVID-19 plans entitled ‘The Fifty Economic Plan’, which aim to promote new economic models based on smart technology, knowledge and advanced sciences, Sheikh Mohammed expressed optimism at the count...

Malaysia-based RAM Sustainability, a member of the RAM Group of companies, received Approved Verifier status to certify Climate Bonds under the Climate Bonds Standard and Certification Scheme (Scheme) on the 12th of August 2020. Receiving certification under this Scheme will allow issuers to prove to the market that their green securities, loans, or Sukuk, adhere to global best practices with regards to climate integrity, transparency, and management of proceeds. As well as incorporating voluntary guidelines like the Green Bond Principles and Green Loan Principles, the Scheme also...

All Issuer Default Ratings (IDRs) of Islamic banks assigned by Fitch Ratings (Fitch) in Gulf Cooperation Council (GCC) countries are considered to be investment grade, indicating relatively low to moderate credit risk, according to a recent report released by the credit rating agency titled ‘GCC Islamic Banks: 2020 Compendium’.  According to Fitch, 89% of IDRs of Islamic banks in the GCC were backed by sovereigns’ ability to provide support either directly or through a parent, whilst the remaining 11% of IDRs were driven by the banks’ standalone creditworthiness, as expressed by the...

Banks of all sizes are becoming more interested in responsible finance, but progress remains slowInvestors’ expectations relating to ESG integration are moving more quickly and gaining tractionWith a rising bar for responsible finance – and many banks clustered near that level – there is a competitive opportunity for banks that can stand out to consumers, investors and regulators by adopting best practices on ESG Even the most ambitious banks on responsible finance face gaps, leaving plenty of opportunity in the responsible finance landscape. An analysis by Mazars of...