RAM Ratings monitoring unfulfilled conditions subsequent to AC First Genesis’ First Tranche Sukuk Ijarah following third extension

Published on 27 Feb 2023.

Share Tweet Email

AC First Genesis Berhad (the Issuer) has obtained another six-month extension to comply with remaining conditions subsequent to its RM785 mil First Tranche Sukuk Ijarah. This follows the previous approval from the sukukholders to extend the deadline from 20 June to 20 December 2022 (click here). The Issuer now has until 20 June 2023 to fulfil the said conditions subsequent. The latest extension was requested as the Issuer has yet to receive a response from the land office to its appeal for a waiver/reduction of the memorandum of transfer (MOT) registration fee.

The sukukholders have provided conditional approval for the extension, the third to date. Among other prerequisites, the Issuer must (1) earmark RM3.75 mil in the transaction’s Revenue Account (RA) for the payment of the MOT registration fee; and (2) provide an irrevocable and unconditional written instruction to the Security Trustee to pay the fee if the waiver/reduction is not obtained by 20 June 2023. The Issuer will still be prohibited from paying any profit on the Subordinated Class D Sukuk until all conditions subsequent have been fulfilled. We understand that the Issuer will resubmit the fee waiver/reduction application and meet with the land officer in charge to follow through on the matter.

Sukuk Ijarah


Issue Size
(RM mil)

LTV (%)

FSCR (times)

Senior Class A





Senior Class B





Guaranteed Class C





Subordinated Class D





LTV = Loan to value
FSCR = Finance service coverage ratio


Overall, we view the transaction’s prolonged exposure to an incomplete security position as undesirable, particularly given that Aman Central Mall – the securitised property – is the sole security and source of cash flow to service the First Tranche Sukuk Ijarah. That said, the irrevocable and unconditional written instruction to the Security Trustee is considered credit positive, providing visibility on when the sukukholders’ security position will be perfected. In this regard, we do not expect the time extension to immediately impact the ratings. We will monitor progress made on this front and may reassess the ratings if the said conditions remain unfulfilled as anticipated. 

Although only RM3.75 mil in the RA will be allocated for the potential RM22.5 mil registration fee (inclusive of late payment penalty), the legal counsel confirms that the terms of the transaction documents allow the Security Trustee to utilise funds in the RA to meet these expenses. As at end-January 2023, the RM26.6 mil of cash available in the RA was sufficient to cover property expenses, profit distribution and the registration fee to meet the remaining conditions subsequent, if required. 

Aman Central Mall is an eight-storey retail mall in Alor Setar, Kedah. The transaction’s ultimate sponsor is Belleview Sdn Bhd (the Group), a niche property developer in the northern region with a track record dating back to 1984, which includes low-cost to high-end housing and commercial properties like shopping malls and office suites. Aman Central Mall was previously held via Great Realty Sdn Bhd, the Group’s wholly owned subsidiary, before it was securitised under AC First Genesis’ sukuk programme in May 2021.


Analytical contacts
Liew Kar Ling
(603) 3385 2586

Lim Chern Yit
(603) 3385 2528


The credit rating is not a recommendation to purchase, sell or hold a security, inasmuch as it does not comment on the security’s market price or its suitability for a particular investor, nor does it involve any audit by RAM Ratings. The credit rating also does not reflect the legality and enforceability of financial obligations.

RAM Ratings receives compensation for its rating services, normally paid by the issuers of such securities or the rated entity, and sometimes third parties participating in marketing the securities, insurers, guarantors, other obligors, underwriters, etc. The receipt of this compensation has no influence on RAM Ratings’ credit opinions or other analytical processes. In all instances, RAM Ratings is committed to preserving the objectivity, integrity and independence of its ratings. Rating fees are communicated to clients prior to the issuance of rating opinions. While RAM Ratings reserves the right to disseminate the ratings, it receives no payment for doing so, except for subscriptions to its publications.

Similarly, the disclaimers above also apply to RAM Ratings’ credit-related analyses and commentaries, where relevant.

Published by RAM Rating Services Berhad
© Copyright 2023 by RAM Rating Services Berhad

Ratings on AC First Genesis Berhad