Malaysia Bond House: CIMB Investment Bank

IFR Asia Awards 2021
3 min read
Kit Yin Boey

Strong leadership

CIMB Investment Bank showed strong leadership in a rebounding ringgit bond market in 2021, bringing holistic solutions to existing clients and leading new credits over the hurdles introduced by the pandemic.

Corporate issuers that made their maiden forays into the local bond market this year praised CIMB for its pivotal role their successful issues, while a major fund investor said the bank’s transparent communications to investors while juggling large order books earned it well-deserved respect as a lead bookrunner.

“We are not suitcase bankers, we are here to stay,” said Nor Masliza Sulaiman, CIMB’s regional head of capital markets.

“What differentiates us is we are not followers but leaders in the market. We design term-sheets and innovate structures. This is our home market, and we invest a lot of resources to do this ... to survive for decades.”

The bank topped the year’s ringgit bond league table with more than M$24.3bn (US$5.5bn) under its belt, representing 23.2% of the M$104.8bn of bonds sold in 2021.

CIMB’s deep understanding of Malaysia’s regulatory landscape for financial institutions earned it a number of mandates to lead bank deals this year – a reflection of other banks’ confidence in CIMB’s execution and distribution skills. The deals included MUFG Bank Malaysia’s M$250m 2.8% two-year sukuk in March, Bank Pembangunan Malaysia’s M$1.75bn multi-tranche sukuk offering in May and Small Medium Enterprise Bank Malaysia’s M$500m sustainability multi-tranche sukuk offering in August.

The ringgit bond market was deepened by a number of new credits brought by CIMB, among them The Holstein Milk Company, which sold a M$200m 3.72% five-year sukuk in May and South Korea’s Hanwha Q CELLS Malaysia’s M$150m 3.05% three-year issue in August which was the first ringgit-denominated green bond to be guaranteed by the Credit Guarantee and Investment Facility.

Offshore, its Islamic finance expertise and market reach helped it win roles on US dollar sukuk offerings for the governments of Malaysia, Indonesia and the UK.

CIMB demonstrated its strong structuring skills and power to pull in a critical pool of investors when Khazanah Nasional in May sold a US$1bn unrated dual-trancher of five and 10 years. Without a rating, Khazanah could not sell the foreign-currency notes to local investors, thereby depriving the issuer of a key investor base.

The issuer accepted a proposal to convert an initial structure combining conventional and sukuk tranches into a full sukuk offering to target Middle Eastern investors, which have had long relationships with CIMB. Middle Eastern orders accounted for 22% each of the five-year and the 10-year tranches, bringing crucial support to the deal.

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