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Ihsan Sukuk redeems RM100 mil first SRI sukuk
Published on 17 Jun 2022.
RAM Ratings has received confirmation that Ihsan Sukuk Berhad redeemed the RM100 mil First Sukuk Ihsan, issued under its RM1.0 bil Islamic Medium-Term Notes Sukuk Ihsan Programme (2015/2040), on 17 June 2022. We will maintain surveillance of the Programme, the rating of which was reaffirmed at AAA(s)/Stable on 6 December 2021.
As Ihsan Sukuk was incorporated as the Islamic financing conduit of Khazanah Nasional Berhad (Khazanah), the rating reflects Khazanah’s credit strength in its role as the Purchase Undertaking Obligor for the Programme. Ihsan Sukuk has RM100 mil of sukuk outstanding under the Programme, maturing on 8 August 2024.
The redemption marks the conclusion of the first sustainable responsible investment (SRI) sukuk issued in Malaysia, approved under the Securities Commission’s revised sukuk guidelines launched in August 2014. Pursuant to the fulfilment of predefined key performance indicators (KPIs), Khazanah as the obligor enjoys a 6.22% reduction on the redemption amount, being the nominal value of the First Sukuk Ihsan. The sukukholders have received tax vouchers equivalent to the reduction in nominal value.
We have also received confirmation that 17% of the sukukholders had waived their rights, benefits and entitlement to receive the nominal amount payable and one periodic distribution of the First Sukuk Ihsan. Tax vouchers equivalent to the amount waived will be issued.
Ihsan Sukuk is a trust-owned company established for the sole purpose of raising capital to support Khazanah’s corporate social responsibility efforts. Ihsan Sukuk raises funds under the Islamic principle of wakalah bi al-istithmar and/or other Islamic principles to be determined, which will be used to purchase eligible sukuk investments. Khazanah, in turn, will use the proceeds to fund shariah-compliant eligible SRI projects, as defined in the Securities Commission’s sukuk guidelines.
Two RM100 mil sukuk facilities were issued in June 2015 and August 2017, the proceeds of which were used to fund Yayasan AMIR’s Trust Schools Programme. A not-for-profit foundation set up by Khazanah in October 2010, Yayasan AMIR focuses on improving access to quality education in government schools through its Trust Schools Programme. Of the total 94 schools under the Trust Schools Programme, a respective 30 and 21 schools are funded by the sukuk facilities issued in 2015 and 2017.
Analytical contacts
Ben Inn
(603) 3385 2510
ben@ram.com.my
Tan Han Nee
(603) 3385 2529
hannee@ram.com.my
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