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RAM Ratings assigns ratings to Maybank Islamic’s proposed senior sukuk programmes
Published on 15 Nov 2022.
RAM Ratings has assigned respective P1 and AAA/Stable ratings to Maybank Islamic Berhad’s (Maybank Islamic or the Bank) proposed RM20 billion Islamic Commercial Papers Programme and RM20 billion Islamic Medium-Term Notes Programme.
Maybank Islamic is a core entity of Malayan Banking Berhad (Maybank or the Group, rated AAA/Stable/P1), given its strategic role as the latter’s Islamic banking arm. We expect parental support to be readily available if required. Maybank is Malaysia’s largest domestic banking group.
Boasting an asset base of RM273 bil as at end-June 2022, Maybank Islamic is the largest Islamic bank in the country. The Bank’s credit metrics remained strong, its gross impaired financing (GIF) ratio decreasing to 1.0% as at the same date (end-December 2020: 1.2%). The improvement was largely due to the reclassification of impaired financing funded by restricted profit-sharing investment accounts, which is now treated as an off-balance sheet item. This offset higher GIF formation in 1H FY Dec 2022, primarily stemming from corporate borrowers.
The Bank’s sound pre-provision profit is expected to adequately cover additional provisioning needs without depleting its capital base. Its common equity tier-1 capital and total capital ratios (net of proposed dividends) stood at a respective 12.6% and 16.6% as at end-June 2022. We have no concerns over the Bank’s funding and liquidity profile.
Analytical contacts
Jeremy Noel Paul
(603) 3385 2556
jeremynp@ram.com.my
Chan Yin Huei
(603) 3385 2498
yinhuei@ram.com.my
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