KUALA LUMPUR: HSBC Amanah Malaysia Bhd and Standard Chartered Saadiq Malaysia have executed a sustainable sale and buy back agreement (SBBA) transaction for RHB Islamic Bank Bhd under an enhanced Shariah-compliant framework.
In a statement, RHB Islamic said this deal, which is a first in the country, represents a significant achievement in Islamic sustainable finance innovation.
An SBBA is an Islamic financial instrument used to source and provide funding for liquidity management in the Islamic Interbank Money Market (IIMM) akin to a repurchase agreement (repo) in the conventional money market.
The sustainable SBBA integrates positive impact to traditional financial instruments, demonstrating a strong commitment by businesses to sustainability goals.
The proceeds from this financing facility will be earmarked for eligible shariah compliant sustainable assets such as green buildings, renewable energy and energy efficiency projects.
This financing mechanism can also be utilised for other types of eligible green and social projects in tandem with RHB’s Sustainability Sukuk and Bond Framework.
The sustainable SBBA is underpinned by an enhanced Master SBBA framework jointly adopted by RHB Islamic, HSBC Amanah and Standard Chartered Saadiq Malaysia, introducing a standardised approach to incorporating sustainability elements across all eligible SBBA transactions, moving beyond single-use sustainable deals toward a repeatable and scalable model.
“This transaction sets a new benchmark for Islamic sustainable finance, showcasing how Shariah principles can be harmonised with global sustainability standards," said Datuk Adissadikin Ali, managing director of RHB Islamic.
