Malaysia Bond House: CIMB Investment Bank
Innovative leader
CIMB Investment Bank secured its spot as Malaysia Bond House of the Year by leading a myriad of unique deals with innovative approaches to execution and structure.
The bank led M$19.9bn (US$4.4bn) of deals, earning it a market share of 21.1% and ranking second in the LSEG league table.
In November, the bank worked on providing a liability management solution for Malaysian property developer Tropicana Corporation, which needed to reduce its debt levels amid reduced profitability and a shortfall in its perpetual sinking fund.
The company had skipped the call date on M$248m of perpetual bonds due in September, triggering a coupon step-up from 7% to 9%. It wanted to exchange the perps for a rated senior bond paying a 6.25% coupon.
The exchange offer required approval from holders of 75% of the perps. To raise the chances of success, CIMB launched a voluntary new money and exchange offer alongside the formal vote at the scheduled general meeting, ensuring at least a portion of the notes would be exchanged, in a first for the ringgit market.
This allowed the issuer to exchange some M$158.57m of its perps and raise M$91.75m in new money.
The bank also worked on Khazanah Nasional’s US$1bn dual-tranche sukuk and conventional bond offering – the only US dollar issue to come out of Malaysia in 2024.
The drive-by deal, split equally between the five-year sukuk and the 10-year conventional bond, opened at initial price guidance of Treasuries plus 115bp area and plus 125bp area at the end of August. It tightened 30bp and 33bp, respectively, to land 7bp and 3bp inside the issuer’s curve on the back of a more than US$5bn peak book.
CIMB was involved in a number of other landmark deals, including debut issuer Johor Plantations Group’s M$1.6bn sustainability-linked sukuk in late September, the world’s first such sukuk from the plantation sector. It further demonstrated its ESG chops when it structured Sunway REIT’s M$500m dual-tranche sustainability-linked perpetual securities, a first for Malaysia.
It also worked on a rare asset-backed transaction for financial services provider RCE Marketing through issuer Zamarad Assets in October, achieving a M$149m deal size. Following careful investor education the issuer found M$1bn in demand at the peak for the notes, which ranged in tenors of one to 8.5 years, allowing it to price about 25bp inside the initial guidance levels.
On the ESG front, the bank also worked on several landmark deals, including Johor Plantations’ M$1.3bn triple-tranche sustainability-linked sukuk – the first of its kind from the plantation sector.
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