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RAM Ratings assigns ratings to RHB Islamic’s proposed RM5 bil sukuk programme
Published on 12 Dec 2025.
RAM Ratings has assigned ratings to RHB Islamic Bank Berhad’s (RHB Islamic or the Bank) proposed RM5 billion Multi-Currency Sukuk Wakalah Programme (see Table 1).
RHB Islamic operates as RHB Bank Berhad’s (the Group, rated AA1/Stable/P1) Islamic banking arm under a leveraged model. Given its strategic importance, we view the likelihood of support for RHB Islamic from the Group as ‘very high’.
The Tier-2 Subordinated Sukuk is rated one notch below RHB Islamic’s long-term AA1 financial institution rating (FIR) to reflect its subordinated status relative to the Bank’s senior unsecured obligations. The Additional Tier-1 Sukuk rating is rated three notches below RHB Islamic’s long-term FIR in view of its subordinated nature, fully discretionary distribution payments and our assessment that the Bank has a ‘high’ capital buffer against the loss absorption trigger, as outlined in RAM’s rating methodology for bank securities.
Over the past three years, RHB Islamic’s return on risk-weighted assets averaged 3.3%. Accounting for 28% of the Group’s pre-tax profits, the Bank remained a major contributor to the latter’s financing book (end-September 2025: 46% of the Group’s domestic financing). Asset quality is healthy, with gross impaired financing (GIF) and GIF coverage ratios of 1.1% and 120%, respectively. The Bank’s common equity tier-1 capital ratio was a strong 14.7% at end-September 2025.
Analytical contacts
Lee Yee Von
(603) 2708 8217
yeevon@ram.com.my
Sophia Lee
(603) 2708 8211
sophia@ram.com.my
Media contact
Sakinah Arifin
(603) 2708 8212
sakinah@ram.com.my
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
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