INFRASTRUCTURE DEBT SECURITIES The Case of Sukuk in Malaysia

Page 0
INFRASTRUCTURE DEBT SECURITIES
The Case of Sukuk in Malaysia
Zainul Hashim
Head, Senior Vice President
Debt Markets
AmInvestment Bank Berhad
25 November 2015
November 25, 2015
Mohd Hedzir Hanafi
Head, Senior Vice President
Capital & Project Advisory
AmInvestment Bank Berhad
Infrastructure Debt Securities: The Case of Sukuk in Malaysia
Presentation Outline
► PART I
► PART II

Introduction

Rating Considerations and Credit
Enhancement

Malaysia’s Experience in
Infrastructure Financing

Case Studies

Typical Financing Plan and
Strategy

Why AmInvestment Bank?
November 25, 2015
Page 1
Page 2
Introduction
November 25, 2015
Evolution PPP in Malaysia
Page 3
1983
Malaysia
Incorporated Policy
Privatisation Policy
1985
Privatisation
Guidelines
1991
Privatisation
Masterplan
2010
Facilitation Fund
Introduced
2009
PPP Unit Formed
PPP Guideline
Introduced
2006
PPP Introduced
Source: Asia Executive Programs workshop
Various PPP Models
adopted:
 Build-Operate-Transfer
 Build-Operate-Own
 Build-Lease-MaintainTransfer
 Build-Lease-MaintainOperate- Transfer
 Management / Operation
outsourcing
 Leasing and land swap
 Sales of public asset /
equity
November 25, 2015
Current Emphasis:
 Highways
 Education
 Health
 Government
administrative building
 RM20 billion Facilitation
Fund established as
tipping point to encourage
private investment
Private Funding
 Equity
 Bank borrowing / loans
 Private debt securities /
Sukuk
 Typical debt-to-equity ratio
of 80% - 90% to 10% 20%
Public / Government
Funding
 Government soft loan
 Government subsidy
 Government grants (for
land acquisition)
Evolution PPP in Malaysia (cont’d)
Page 4
 PFI - first mentioned in the Ninth Malaysia Plan in March 2006 as an alternative procurement method for the Government.
 Aim - to facilitate greater participation of the Private Sector to improve the delivery of infrastructure facilities and public
services.
 2009 - Privatisation and Private Finance Initiative (PFI) Unit was established under the Prime Minister's Department.
 Currently known as Unit Kerjasama Awam Swasta (“UKAS”).
UKAS’ main responsibilities
Legislate and strategize a PPP policy that is suitable to
the country’s economic situation and time
Study and endorse the PPP proposals for the approval of
the Cabinet
Plan, administer, control and evaluate the
implementation of the National PPP programmes
Manage the PPP’s Facilitation Fund
Structure of PPP Project
Typical PPP Business Models
Structuring a PPP project involves bringing together relevant
private sector parties with clearly defined tasks and risks of the
project. The main parties would include:
The typical PPP Business Models are as follows:
Main parties in PPP Project
PPP Business Models
 Special purpose vehicle created specifically for the project
 Build-Lease-Maintain-Transfer
 Financiers
 Build-Lease-Maintain-Operate-Transfer
 Construction contractor
 Build-Own-Transfer
 Facilities management operator
 Build-Operate-Own
 Public sector (procuring authority)
Source: UKAS PPP Guidelines, Asia Executive Programs workshop
November 25, 2015
Page 5
Malaysia’s Experience in Infrastructure Financing
November 25, 2015
Malaysian Debt Capital Market
Page 6
Private Debt Securities / Sukuk Issuance Amount
Source: Bloomberg (13 Nov 2015)
117.8
79.2
67.0
68.6
49.5
44.6
AIBB’s Portion (%)
13.2
47.4
18.8
44.9
18.9
13.8
16.8
16.2
15.2
18.3

YTD issuance of PDS / Sukuk is 37.5% down from last year in the first few months of the year, with total PDS / Sukuk
issuance being recorded at MYR45.9 billion (2014: MYR79.2 billion). However, the market is expected to close with MYR70
to 80 billion by the year end.

New issues improved across these sectors: finance (MYR24 billion, 48.1%), real estate (MYR2 billion, 4.8%) and business
services (MYR300 million, 0.6%) sector, which has remained the chief driver of PDS / Sukuk issuance.
November 25, 2015
Malaysian Debt Capital Market (cont’d)
Supply Profile of Government Bonds / Sukuk in 4Q15
Page 7
Source: Bloomberg / BNM
Projected 2016
Projected 2016 – 2018
Issuance
Redemption
Net
% of Total Issuance
MGS
45.4
(26.7)
18.7
47 – 52%
GII
44.4
(22.0)
22.4
49 – 52%
Others
0.8
-
0.8
Total Issuance
90.6
(48.7)
41.9

Expect gross issuance of government debt to decline over the next 3 years, with importance of GII to gradually rise beyond
an alternative to MGS.

Total issuance of government debt is estimated at MYR93.6 billion in 2015, MYR90.6 billion in 2016, MYR90.5 billion in 2017
and MYR88.9 billion in 2018.

Foreign holdings of MGS retraced 2.3% m-o-m to MYR153.8 billion, bringing down the proportion of foreign-held MGS over
total outstanding MGS by 0.4% to 45.6% as at end-September 2016.
November 25, 2015
Infrastructure Funding via Malaysia Bond Market
Approximately 11% or RM5.5 billion (or USD1.3 billion equivalent*) of YTD issuance of PDS / Sukuk, and current outstanding
corporate bonds in 2015 comprise infrastructure project bonds:
Sector
%
Power/Electricity
3.0
Toll Roads
3.1
Water
4.4
Others
0.6
Source : Bloomberg, AmBank Research and internal sources, Nov 2015
Note: * Exchange rate 1USD = RM4.3160 as at 24 November 2015 (Source: Bank Negara Malaysia’s website)
November 25, 2015
Page 8
Summary of Malaysian Budget 2016
Page 9
Balanced Agenda with Prudent Targets
Source: AmResearch
Key Themes of the Federal Government’s Budget 2016
► Budget deficit cut to -3.1% of GDP in 2016


► Real GDP growth for 2016 forecasted lower at 4.0% -
Low growth in revenue (fall in crude oil price despite
implementation of GST, increased higher personal
income tax for higher income personnel)
Oil-related revenue to fall further (drop in Petronas
dividend to the Government, lower petroleum income
tax/export duties)
5.0%
Gov. Debt to GDP
60%
4.0
3.5
40%
3.0
Overnight Policy Rate
2.5
20%
► Major public infrastructure and investment projects to
continue

MRT1, MRT2, RAPID, Pan-Borneo Highway, DASH,
SUKE & RAPID
► Allocations
and incentives to spur
activities and SMEs in targeted sectors

investment
Tax and funding incentives, Special Reinvestment
Allowance, tax incentives
November 25, 2015
As at 9 November 2015
Gov. Debt to GDP
54.2%
Foreign Holdings of MGS
46.0%
Overnight Policy Rate
3.25%
Consumer Price Index
2.6%
Real GDP (YoY)
4.9%
Oct-15
Oct-14
Oct-13
Oct-12
1.5
Oct-11
0%
Oct-10
Increased BR1M handouts, minimum wage hike,
higher civil servant payments, expanded list of zerorated GST items, provision of affordable housing
Oct-09

2.0
Foreign Holdings of MGS
Oct-08
► Measures for the Low and Middle income groups
Summary of Malaysian Budget 2016 (cont’d)
Balanced Agenda with Prudent Targets
► Development Expenditure Allocated MYR50b

5.4% higher than the MYR47.4b estimated for the
year

Non-financial public corporations to drive bigger
public sector investment agenda, led by Khazanah
with commitment of investments worth:

MYR6.7b in 9 domestic projects in health,
education, tourism, software and communication
infrastructure

MYR500m for venture capital and private equity
funds that include a tourism capital venture fund
amounting to MYR50m
November 25, 2015
Page 10
Source: AmResearch
Global Sukuk Outlook
Page 11
► Malaysia Continues Leading Global Sukuk Issuances
and Outstanding

As at YTD October 2015, the total global sukuk
issuance is USD28.7 billion, lower by 24.5% from the
same period last year of USD38.1 billion.

Malaysia remains the largest sukuk issuer as at YTD
Oct 2015, accounting for a sizeable USD12.0 billion
or 41.8% of total global sukuk issuances. United Arab
Emirates came in second, with a market share of
18.3% of global sukuk issuances. Other issuing
nations include Saudi Arabia (16.0%) and Indonesia
(9.0%).
► Beyond Sovereigns

Non-traditional Muslim countries’ increasing traction
in sukuk issuance is underpinned by debut issues
from the United Kingdom, Hong Kong, Senegal and
South Africa in 2014.

Hong Kong’s second sukuk issue in May 2015
(following its first in September 2014) highlights the
sukuk market’s attractiveness in offering an
alternative funding platform to diversify its investor
base as well as to seek competitive pricing.

While there were more sovereign issuers in 2014,
issuance by quasi sovereigns has been gradually
increasing. The better diversity in issuers bodes well
vis-à-vis confirming the acceptance of sukuk as a
viable financing option by the larger community,
instead of only as a liquidity tool for central banks.

According to Standard & Poors, Islamic finance
growth is expected to be between 10%-15% growth
on average as low commodity prices shall have its
effects on the economic growth for some of the core
markets in Islamic finance.
Market Share of Global Sukuk Issuances (2006 - Oct 2015)
2014
2013
2012
2011
2010
2009
2008
2007
67%
Others
24%
Market
Share of
Global Sukuk
Issuance
(Oct-15)
40%
51%
53%
Saudi Arabia
16%
61%
56%
39%
43%
November 25, 2015
Malaysia
42%
UAE
18%
Source: Bloomberg
Types of projects funded by the bond markets
Page 12
Typical Sectors suitable for Project Bonds
Power
Oil & Gas
Waste Management
Toll Roads /
Bridges
Sea Ports
Water
Government
Buildings
Telecommunications
Infrastructure
Public Private Partnership
(“PPP”)
Police
Quarters
Teachers
Quarters
Hospitals
November 25, 2015
An Enabling Environment
► Track record not required to issue bonds

No listing requirement

SPV structure is therefore possible

Cash flow can be ring-fenced effectively to service
debt



► Ability to do bought deal

Provides avenue to project sponsor to lock in funding
cost without taking too much market risks
► Liquid benchmark bonds provided the anchor to
Project sponsors are able to have access to financing
with no/limited recourse
price long dated project bonds

MGS goes up to long tenors
Highly leveraged financing is available

Principal Dealership system create active trading in
benchmark bonds
► Natural demand from a pool of long term investors

Page 13
Compulsory contribution to the Employee Provident
Funds created a need to invest in bonds that provide
long term stable return
Insurance companies are allowed to invest in
corporate bonds to meet their return requirement
November 25, 2015
► Trustee system provided a platform to monitor
security and financial covenants

Bond trustees are charged with the duty to monitor
the compliance of financial covenants from the
periodical reports submitted by the issuers. Security
trustees are appointed to ensure security covenants
are complied with
Page 14
Rating Considerations and Credit Enhancement
November 25, 2015
Project Financing Rating Considerations
Page 15
Completion Risk
Performance Risk
Relates to construction risks – complexity and construction
schedule, contract type, contractor profile
Encompasses demand risk, O&M risk, regulatory risk, offtaker credit strength, single project risk, financial risk.
Construction Risk
Demand Risk
Contract Type
Dependent on the terms of the off-take contract.

Turnkey or unit price contract.

Generally more favourable view on turnkey contract –
most of the construction risk is borne by the EPC
contractor.
O&M Risk
Complexity of Construction


Dependent on design complexity
specifications of the project.
and
technical
Rating agencies have negative views on aggressive
construction schedule.
Contractor Profile

Credit rating for the project would depend on track record
of the contractor.
November 25, 2015
Contracted operational and maintenance conditions.
Regulatory Risk
Changes to government policies.
Single Project Risk
Force majeure events or major operational failure.
Off-taker Credit Strength
Credit rating of off-taker acts as overall rating cap.
Project Financing Rating Considerations (cont’d)
Page 16

Credit rating agencies place great emphasis on debt/finance service coverage ratios (“FSCR”) particularly for project finance
transactions.

FSCR is calculated as the ratio of annual pre-financing cash flow to the sum of annual principal and interest payment
obligations.

The general FSCR benchmarks for relevant infrastructure projects are outlined below:
Rating Category / Sectors

DSCR / FSCR (with cash balances, post-distribution)
Toll Road
IPP
PFI
AAA
2.80 times
2.00 times
2.00 times – 2.15 times
AA1
2.50 times
1.80 times
1.80 times – 1.95 times
AA2
2.25 times
1.65 times
1.65 times – 1.80 times
AA3
2.00 times
1.50 times
1.50 times – 1.65 times
Other criteria that are considered include financing structure and covenants security coverage and liquidity features such as
debt service or maintenance service accounts.
November 25, 2015
Credit Enhancement
Page 17
Performance Risk
Completion Risk

Completion Guarantee from Sponsors
Cost overruns (up to a certain limit).
►
►
Principal and interest payments under the financing
pre-completion.
CG on the principal and interest obligations for the
entire tenor of the financing.
►
Rating to mirror project sponsor’s corporate rating.
Konsortium ProHAWK Sdn Bhd (AA2)
►
Manjung Island Energy Berhad (Series 2 only) (AAA)
Cost-Overrun Liquidity Facility (“COLF”)

Rolling Guarantee from Sponsors
►
Procured from highly rated banks.
►
►
Buffer against any cost overruns and shortfalls in net
operating cash flows.
Rolling guarantee on the next principal and interest
payment only.
►
Valid for entire financing tenor.
Jimah Energy Ventures Sdn Bhd (AA3)
►
TNB Northern Energy Berhad (AAA) & TNB Western
Energy Berhad (AAA)
►

Corporate Guarantee from Sponsors
►
►


External Guarantee
►
Procured from external guarantors (for e.g. Danajamin
& banks) on financing obligations.
►
Guarantee valid for construction period only.
►
Sasaran Etika Sdn Bhd (AA1)
November 25, 2015

External Guarantee
►
Procured from external guarantors (for
Danajamin & banks) on financing obligations.
►
Valid for entire financing tenor.
►
Rating will mirror that of the guarantor.
►
Incurs guarantee fee.
►
West Coast Expressway (AAA)
e.g.
Page 18
Case Studies
November 25, 2015
DANAINFRA NASIONAL BERHAD
GG ICP/IMTN Programme of up to MYR21.0 Billion
TRANSACTION DETAILS
Facility
Islamic Commercial Papers and Islamic Medium
Term
Notes
Programme
(“ICP/IMTN
Programme”) and Syndicated Islamic Revolving
Credit-i Facility (“RC Facility”) of up to MYR21.0
billion in aggregate nominal value
8 Feb 2013
Tenure
TRANSACTION HIGHLIGHTS
Size
million
From
7 years MYR300
to 30 years
Tenor
10 years
28 Nov 2013


MYR100 million
15 years
The MRT Project is one of the projects under Greater Kuala
Lumpur - Klang Valley Public Transport Masterplan. First phase,
Sungai Buloh – Kajang Line is a proposed passenger rail line
running from Sungai Buloh to Kajang covering a distance of 51
kilometers.
8 Feb 2013
28 Nov 2013
DanaInfra Nasional Berhad (“DanaInfra”), wholly owned by
Applications
1,424
603
Ministry of Finance, Incorporated, was established as a funding
vehicle
toValue
the MRT Project.
Total
MYR484.31 mil
MYR219.013 mil
Oversubscription
times
2.19
DanaInfra’s
main objectives 1.61
are to
ensure certainty
of times
funds and
rate
optimum financing cost through market driven pricing that is near
sovereign rates.
Guarantee
Irrevocable
and unconditional guarantee by the
Profit
4.00% p.a.
Government
of Malaysia
(“GOM”) 4.58% p.a.
Rate

Programme
Tenure
Up to 50 years from the date of first issuance

Utilisation of
Proceeds
To fund the construction and development of the
Mass Rapid Transit Project (“MRT Project”)
The ICP/IMTN Programme together with the RC Facility, both
credit enhanced through the GOM guarantee, provide a funding
platform for DanaInfra to raise funding up to MYR8.0 billion. The
RC Facility provided by the Joint Lead Arrangers serves as a
back stop mechanism to ensure availability of funds to DanaInfra
at all times.
Shariah
Principle
Murabahah or other Shariah principles to be
determined

The outstanding nominal value of the Sukuk and the outstanding
principal amount of the RC guaranteed by the GOM shall not
exceed MYR8.0 billion at any one time.
AmInvestment
Bank’s roles
Joint Lead Arranger / Joint Lead Manager / Joint
Book Runner

Repayment of the funds will be via GOM’s contributions on a
deferred payment basis via the Operational Expenditure of the
annual budget.
November 25, 2015
Page 19
DANAINFRA NASIONAL BERHAD
GG ICP/IMTN Programme of up to MYR21.0 Billion (cont’d)
DISTRIBUTION ANALYSIS
Financial
Institutions
30%
Development
Financial
Institution
8%
Government
Agency
13%
PRICING ANALYSIS
Asset
Management
25%
Size
Issuance
8 Febof
2013
MYR2.4
MYR300
billion million
Tenor
10 years
Profit
Rate
4.00% p.a.

DanaInfra together with AmInvestment Bank and other Joint
Lead Arrangers conducted an investor briefing which garnered
strong support from the investors.

The investor presentation was followed by a book building
exercise for DanaInfra’s maiden
During
the two8 FebSukuk
2013 issuance.28
Nov 2013
day book building exercise, the Sukuk registered an
Applications
1,424
603
overwhelming interest from investors with the final bid-to-cover
ratioTotal
of 4.8Value
times over the MYR484.31
issuance size.
mil
MYR219.013 mil
28 Nov 2013
MYR100 million
15 years
Insurance
24%
4.58% p.a.

Insurance companies were given preference in the allocation of
the longer tenures Sukuk (12- and 15-year) to match their portfolio
liabilities.
FLEXIBILITY OF THE ICP/IMTN PROGRAMME
Islamic Principles
Options to change Islamic principles from Murabahah to Wakalah,
Musyarakah, Ijarah, Bai’ Inah or Bai’ Bithaman Ajil to be
determined prior to each Sukuk issuance
RELEVANCE TO MARKET

The Sukuk was the first public funding exercise for the MRT
Project via the Sukuk capital markets which commanded high
demand from investors.

Investors’ appetite for shorter term Sukuk has prompted
DanaInfra to establish the 7-year Sukuk of MYR300.0 million to
attract a wider investors base.

Tax and stamp duty remission for the Sukuk enhanced the Sukuk
attractiveness thereby achieving optimum pricing for DanaInfra.
Upsizing of ICP/IMTN Programme Size
Option to upsize the programme size to accommodate total
project cost of MRT Project upon awards of all contracts
November 25, 2015
Oversubscription
1.61 times
2.19 times
Despite
rate the price guidance of up to 33bps for the Sukuk,
DanaInfra and the Joint Lead Managers managed to achieved a
competitive pricing level at MGS + 26 bps for the 7- and 10-year
Sukuk and MGS + 28 bps for the 12- and 15-year Sukuk, thereby
tightening the price for DanaInfra’s inaugural Sukuk.
Page 20
PROJEK LEBUHRAYA USAHASAMA BERHAD
AAA-Rated & GG Islamic Medium Term Notes
TRANSACTION DETAILS
Facility
i. Up to MYR23,350 million nominal value AAArated Islamic Medium Term Notes (“IMTNs”);
and
ii. Up to MYR11,000 million nominal value
Government Guaranteed Islamic Medium
Term Notes (“GG IMTNs”).
Credit Rating
i. IMTNs: AAA
ii. GG IMTNs: Non-rated
Utilisation of
Proceeds
Tenor
Our Role
To finance the purchase considerations for the
proposed acquisition of all the assets, liabilities,
business, undertakings and rights of highway
concession companies and other Shariah
compliant funding requirements.
i. IMTNs: 5 – 25 years
ii. GG IMTNs: 26 – 27 years
PIONEER IN PRODUCT INNOVATION
Credit Strengths
 The Issuer was incorporated to acquire key highway concessions;
PLUS, ELITE, Konsortium Lebuhraya Butterworth-Kulim,
LINKEDUA and Penang Bridge.
 AAA rating secured as Issuer viewed to be government related and
has proven track record of strong performance of its tolled
expressways.
Innovative Transaction Volume
 Excess IMTNs which are not issued from the IMTN Programme
serve as a standby line to cover cashflow shortfall in the initial
years.
 Repayment profile of up to 27 years matches the Issuer’s projected
income from the remaining life of the concessions.
 The GG IMTNs which shall be redeemed in the last 2 years of the
concessions, act as the tail period to further improve the Issuer’s
repayment capabilities.
Joint Lead Manager
 Effective execution strategy to ensure successful issuance due to
deal size.
November 25, 2015
Page 21
PROJEK LEBUHRAYA USAHASAMA BERHAD
AAA-Rated & GG Islamic Medium Term Notes (cont’d)
RELEVANCE TO MARKET
SUKUK MUSHARAKAH STRUCTURE
 Single largest MYR-denominated Sukuk issuance in the history of the
global Islamic capital markets.
 Evidence of high liquidity in the market and demand for issuances by
established companies for long-dated bonds.
 Joint Lead Managers for this deal offered certainty of funding to the
Issuer via a bought deal arrangement and private placement was
arranged to a strategic investor.
 Distribution strategies ensured successful placement of IMTNs and GG
IMTNs which were oversubscribed by 4x during the subdued month of
December.
 High credit papers commanded strong support from a wide investor base
for secondary trading.
GOM
5
4 Purchase Undertaking
TRUSTEE
(acting for
Sukukholders)
3 Appoint as Manager
ISSUER
(Manager)
2 Sukuk Proceeds
1 Identif ies
Government
guarantee
2 Invest in
business
MUSHARAKAH
VENTURE
(Trust Assets)
venture
2
Musharakah
Capital / Proceeds
2 Issues Sukuk
SUKUK
HOLDERS
3 One-Of f Distribution / Periodic Distribution
 Tax exemption for the GG IMTNs enhanced their attractiveness thereby 1. The Issuer identifies its business (i.e. the highway concessions) as the
achieving optimum pricing.
underlying asset for the Musharakah transaction.
2. From time to time, investors form a Musharakah Venture amongst
themselves, evidenced by subscription of the Sukuk Musharakah. The
Issuer declares trust over the underlying assets for the benefit of
Sukukholders.
1.DISTRIBUTION ANALYSIS
Financial
Institutions,
20%
QuasiGovernment
Co.,
52%
Aggregate
Issuance of
MYR30.6
billion
Fund
Management
Co.,
11%
Insurance
Co.,
18%
3. The Trustee shall appoint the Issuer as the manager of the Musharakah
Venture. Income from the Musharakah Venture shall be distributed
periodically or on a one-off basis to the Sukukholders upon the maturity
date of the Sukuk Musharakah or the Dissolution Date, whichever is the
earlier.
4. The Issuer grants a purchase undertaking in favour of the Trustee
(acting on behalf of the Sukukholders) to undertake to purchase the
Sukukholders’ interest in the Musharakah Venture and pay the Exercise
Price on either the maturity date of the Sukuk Musharakah or on the
Dissolution Date, whichever is the earlier.
5. Government of Malaysia guarantees the GG IMTN.
November 25, 2015
Page 22
Page 23
Why AmInvestment Bank?
November 25, 2015
Why AmInvesment Bank?
Page 24
AmInvestment Bank provides a wide range of innovative and integrated financing solutions via the Malaysian debt / Islamic
capital markets, serving a clientele across a diverse range of industries. We have a long-standing track record in structuring
award-winning and significant market transactions that contribute to the development of the Malaysian debt capital markets
while offering tailored financing solutions to meet each client’s specific requirements.
Our Competitive Edge
Market
Dominance
Landmark
Transactions
Established
Debt /Islamic
Markets Team
Widespread
Distribution
Network
November 25, 2015
 Top 3 positions on Bloomberg Underwriter Rankings for MYR-denominated PDS for 12 years consecutively and Top 3
for Malaysian Loan Syndication.
 Command 15-20% of Bloomberg Underwriter Rankings for Malaysian Bonds and MYR Islamic Bonds for the past 12
years.
Our landmark transactions completed are:
 Financing for Penang’s Second Bridge Project –
Jambatan Kedua
 Repeat Mandate by the Country’s Infrastructure
Conduit – Prasarana Malaysia
 Sole Casino Operator in Malaysia – GENM
Capital (Genting)
 Largest State Bond Issuance – Sabah State Government
 Largest Danajamin-Guaranteed Facility in 2014 –
Berjaya Land
 Tan Chong Motor’s Debut MTN Issuance in Malaysia
 Strong Debt Markets team comprising
professionals experienced in finance,
accounting, tax, actuarial, legal, credit rating, risk management, engineering and
regulatory.
 Experienced and dedicated Islamic Markets team backed by extensive record in
Islamic finance.
 Specialised Syndicated Loan, Structured Finance, Capital & Project Advisory teams.
 Numerous on-the-ground sales and trading professionals in Malaysia, servicing
clients across a range of Islamic capital market products.
 Ability to leverage on our major shareholder, Australia and New Zealand Banking
Group (“ANZ”)’s international connectivity and
strong distribution channels
for regional market.
Committed to deep,
long standing relationship
Market Leadership and Peer Comparison
Page 25
 Our structuring and syndication specialists are committed to delivering market-leading and customised Islamic financing
solutions via the debt and equity markets to our full spectrum of clients, ranging from corporate and institutional through to
government-linked entities.
 The team leverages on its debt origination and structuring expertise built from comprehensive market and product knowledge
in providing clients with integrated financing solutions. Combined with our execution capabilities, Islamic product innovation
and extensive distribution network, we are able to execute the most complex transactions under the most challenging
circumstances.
Our Breadth of Coverage – Across Industries
#1
50%
Gov-Linked
Entities
35%
Electric
Ranking Amongst Peers – Across Product Type
#2
25%
Lodging
29%
Div. Financial
Services
29%
Real
Estate
21%
Auto
Manufacturers
Notes:
1. Source: Bloomberg (15 November 2014 – 27 October 2015);
2. Total PDS Issuances for the period under review amounts to MYR59 billion
with 382 issuances;
Fin. Guarantee
Issues (by Size)
#1 (61%)
Conventional Issues
(by Count)
#1 (14%)
#2 (13%) #2 (13%) #3 (12%)
Conventional Issues
(by Size)
#1 (30%)
#2 (28%) #3 (12%)
#4 (9%)
Number of Sole
Books (by Size)
#1 (28%)
#2 (26%) #3 (21%)
#4 (9%)
Quasi-Gov
(by Size)
#2 (24%)
#1 (26%) #3 (19%) #4 (18%)
AA Bonds/Sukuk
(by Size)
#2 (22%)
#1 (26%) #3 (18%) #4 (14%)
None
#2 (3%)
None
Source: Bloomberg (15 November 2014 – 27 October 2015)
November 25, 2015
Track Record With Government-Linked Entities
Page 26
Government-Linked Entities
JAMBATAN KEDUA SDN BHD
KLCC REAL ESTATE INVESTMENT TRUST
MYR4.6 Billion Government-Guaranteed Sukuk
Murabahah Programme (2015)
Our Role: Joint Lead Arranger/Joint Lead
Manager/Joint Bookrunner
AAA-Rated MYR3.0 Billion ICP/IMTN Programme
(2015)
Our Role: Joint Principal Adviser/Joint Lead
Arranger/Joint Lead Manager
Malaysia’s first AAA-rated REIT
PROJEK LEBUHRAYA USAHASAMA BERHAD
MYR23.35 Billion
AAA-rated Sukuk
Programme (2012)
Our Role: Joint Lead
Manager
MYR11.0 Billion
Government Guaranteed
Sukuk Programme
(2012)
Our Role: Joint Lead
Manager
Our Role: Joint Lead
Arranger/Joint Lead
Manager/Joint
Bookrunner
First Exchange Traded
Bonds and Sukuk in
Malaysia
November 25, 2015
AAA-Rated Bonds of up to MYR1.0 Billion in
nominal value (2014)
Our Role: Joint Lead Arranger/Joint Lead Manager
SARAWAK ENERGY BERHAD
DANAINFRA NASIONAL BERHAD
MYR21.0 Billion
GovernmentGuaranteed Sukuk
Programme (2012)
SABAH STATE GOVERNMENT
MYR8.0 Billion
Syndicated Islamic Term
Financing Facility (2012)
Our Role: Mandated Lead
Arranger
MYR1.5 Billion Sukuk Musharakah Programme
(2013)
Our Role: Joint Lead Arranger/Joint Lead Manager
PUTRAJAYA HOLDINGS
MYR3.0 Billion Sukuk Musharakah Programme
(2012)
Our Role: Joint Principal
Arranger/Joint Lead Manager
Adviser/Joint
Lead
Our Awards and Accolades
2015
2014
Islamic Finance News Awards 2014
Malaysia Deal of the Year 2014
Midciti Sukuk for KLCC REIT
Islamic Finance News Awards 2014
Real Estate Deal of the Year 2014
Midciti Sukuk for KLCC REIT
Islamic Finance News Awards 2014
Social Impact Deal of the Year 2014
(Honourable Mention)
DanaInfra Nasional Berhad
Islamic Finance News Awards 2014
Regulatory Capital Deal of the Year 2014
(Honourable Mention)
AmBank Islamic Basel III Sukuk
Alpha SEA Deal & Solution Awards
2014
Most Innovative Deal of the Year in SEA
AmBank Islamic Basel III Sukuk
Alpha SEA Deal & Solution Awards
2014
Best Islamic REIT Deal of the Year in
SEA
Midciti Sukuk for KLCC REIT
MARC League Table 2014
Overall PDS – No. 2 by issue count
Conventional – No. 1 by issue count
November 25, 2015
Page 27
The Banker Deals of the Year 2014
Islamic Finance Deal of the Year in
Asia Pacific
Cagamas Berhad MYR3.8 Billion Issue
The Asset Project Finance Awards
2015
Project Finance Bank of the Year
Malaysia
RAM Deals of the Year 2014
(BluePrint Award)
Market Pioneer 2014
AmBank Islamic Basel III Sukuk
The Asset Project Finance Awards
2015
Best Project Finance Deal of the Year
& Best Oil & Gas Deal of the Year
SapuraKencana TMC
RAM Deals of the Year 2014
(BluePrint Award)
New Real Estate Benchmark Deal
Midciti Sukuk for KLCC REIT
RAM Deals of the Year 2014
(BluePrint Award)
Market Pioneer 2014
Cagamas RMB Bond
RAM Deals of the Year 2014
(BluePrint Award)
Market Maker of the Year
ORIX Leasing Malaysia
The Asset Project Finance Awards
2015
Best Transport Deal of the Year
DanaInfra Nasional Berhad
The Asset Triple A Islamic Finance
Awards 2015
Best Corporate Sukuk
Cagamas Berhad
RAM Lead Manager Award
Sukuk – No. 2 by Prog. Value
Sukuk – No. 3 by Issue Count
The Asset Triple A Islamic Finance
Awards 2015
Best Bank Capital Sukuk
AmIslamic Bank Berhad
Bloomberg Underwriter Rankings
Malaysian Bonds – No. 3 (14.9%)
MYR Sukuk – No. 3 (14.2%)
Loan Syndication – No. 5 (6.3%)
The Asset Triple A Islamic Finance
Awards 2015
Best REIT Sukuk
Midciti Sukuk for KLCC REIT
AmInvestment Bank’s Capital Markets Group
Page 28
This Presentation has been prepared by AmInvestment Bank for the exclusive use of the company in evaluating the appropriate corporate structure, proposed funding tool and
determining the optimum financial outcome.
This Presentation is not intended for general circulation or publication nor is it to be reproduced in part or in whole or referred to or disclosed or communicated to any other party or
used in any way for any purpose other than those outlined above without the prior consent of AmInvestment Bank. The information contained herein is confidential information
regarding the proposed structure and is intended for use only by the Company. By accepting this information the Company agrees that it will cause its respective directors, partners,
officers, employees and representatives to agree, to use the information only to evaluate its potential interest in the structure described herein and for no other purpose and will not
divulge any such information to any other party. Any reproduction of this information, in whole or in part, is prohibited.
AmInvestment Bank makes no representations as to the accuracy or completeness of the information provided herein. The statements contained in this Presentation are given in
good faith and in the belief that they are not false or misleading. AmInvestment Bank expressly disclaims any and all liabilities to the Company or any other parties for
representations, expressed or implied, contained in or omissions from the documents or any other written or oral communications transmitted as a result of the circulation,
publication, reproduction or use of this Proposal contrary to the provisions contained herein. At this juncture, we have placed reliance on publicly-available information, wherever
possible, and on information provided to us by the Company.
The information contained herein has been prepared solely for informational purposes.
Capital Markets Group
Corporate Finance
Wholesale Banking Coverage
Seohan Soo | Executive VP
Anuar Omar | Senior VP
Financial Institutions Group
[email protected]
[email protected]
Chean Pei Chen | Senior VP
+603 2036 1631
+603 2036 1715
[email protected]
Debt Markets
Islamic Capital Markets
Zainul Hashim | Senior VP
Dato’ Mohd Effendi | Senior VP
[email protected]
[email protected]
+603 2036 1638
+603 2072 7748
+603 2036 1559
Government-Linked Companies
Hanif Mohd Yusof | Senior VP
[email protected]
+603 2031 9080
Mohd Hedzir Hanafi | Senior VP
Salina Burhan | Senior VP
Infrastructure and Construction
[email protected]
[email protected]
Joanna Yu | Executive VP
+603 2036 1531
+603 2036 1644
[email protected]
+603 2036 1598
November 25, 2015
Thank You
Question