Khazanah Capital, a financing subsidiary of the sovereign wealth fund, has been assigned a senior unsecured rating of (P)A3 by Moody’s Investors Service for the proposed notes to be issued under its existing US$10bil (RM45.4bil) euro MTN programme.
PETALING JAYA: Khazanah Nasional Bhd has established a US$15bil (RM68.1bil) euro medium-term notes (MTN) programme through wholly-owned subsidiaries, Khazanah Capital Ltd and Khazanah Global Sukuk Bhd (KGS).
Khazanah Capital, a financing subsidiary of the sovereign wealth fund, has been assigned a senior unsecured rating of (P)A3 by Moody’s Investors Service for the proposed notes to be issued under its existing US$10bil (RM45.4bil) euro MTN programme.
The MTN programme is irrevocably and unconditionally guaranteed by Khazanah, the rating firm said in a statement yesterday.
Meanwhile, S&P Global Ratings assigned its preliminary A- long-term foreign currency issue rating to the MTN programme and the US$5bil (RM22.7bil) multi-currency sukuk issuance programme of KGS, which is a special-purpose vehicle set up for the purpose of issuing the sukuk.
Moody’s assigned a senior unsecured rating of (P)A3 to the proposed sukuk by KGS as well.
“The obligations under the sukuk programme represent direct, unconditional, unsubordinated and unsecured obligations of Khazanah as the obligor and, except for obligations mandatorily preferred by law, will at all times rank equally with all other present and future unsecured and unsubordinated obligations of Khazanah,” Maisam Hasnain, a Moody’s vice-president and senior analyst, said.
Moody’s A3 rating on Khazanah itself, with a “stable” outlook, assumes a very high likelihood of extraordinary support from the government of Malaysia (A3, “stable”), if required.
This is premised on the fact that Khazanah is wholly-owned by the government and the expected likelihood of government support remains very high.
Khazanah will use the proceeds from the MTN and sukuk to fund working capital, make investments and/or refinance existing borrowings.
Moody’s further noted an upgrade of Khazanah’s A3 rating is unlikely in the absence of an upgrade of Malaysia’s sovereign rating.
Khazanah, which was established in 1993, is Malaysia’s sovereign wealth fund responsible for growing the nation’s long-term wealth.
