KUALA LUMPUR: A proposed RM11.64bil sukuk programme by Pengurusan Aset Air Bhd (PAAB) is expected to help fund the upgrading and development of water infrastructure nationwide.
The Islamic Medium-Term Notes programme will be established through PAAB’s wholly-owned funding vehicle, Pengurusan Air SPV Bhd.
Maybank Investment Bank Bhd and RHB Investment Bank Bhd have been appointed joint principal advisers and joint lead arrangers to structure and coordinate the programme.
The funding is expected to support projects worth about RM1.6bil currently under construction, future projects yet to be identified and developed, as well as projects worth RM13.4bil at the design and tendering stages.
PAAB chief financial officer Zaleha Abdul Hamid said the programme would provide greater flexibility in financing future capital investments while strengthening the organisation’s financial sustainability.
“Our capital investments are long-term in nature, as the recovery of investments in water infrastructure takes place over an extended period.
“As such, this programme will allow us to consider different sukuk structures, depending on our project requirements and market conditions,” she said at the programme’s signing ceremony yesterday.
She said PAAB would also benefit from the expertise of its appointed advisers in structuring the programme and reaching investors.
Maybank Investment Bank chief executive officer Michael Oh-Lau said the proposed programme demonstrated the role of Islamic capital markets in mobilising long-term funding for essential infrastructure.
He said it would enable PAAB to translate its sustainability goals into practical infrastructure investments while expanding its access to sustainable and blue financing.
The partnership would also support PAAB’s broader financing needs as Malaysia continued investing in essential water infrastructure, he added.
“We are pleased to put this expertise to work in supporting PAAB’s long-term funding requirements and Malaysia’s continued investment in essential water infrastructure,” Oh-Lau said.
The ceremony also commemorated PAAB’s inaugural RM300mil placement under Maybank Islamic Bhd’s Islamic Sustainable Fixed Deposit-i programme on Aug 26, which is used to fund sustainable programmes and projects nationwide.
RHB Group Wholesale Banking managing director Datuk Nurjesmi Mohd Nashir said population growth, urban expansion, the development of data centres and climate change were increasing pressure on Malaysia’s water infrastructure.
He said these growing demands made PAAB’s proposed sukuk programme increasingly important.
“For investors, the programme offers a highly rated credit linked to essential national infrastructure. For the market, it adds depth to Malaysia’s debt capital market, which continues to fund infrastructure and other strategic sectors,” he said.
Nurjesmi said the programme’s true value would lie in the long-term benefits it delivered to communities through improved water infrastructure.
“The success of today will not be measured by the documents we sign, but by the infrastructure this programme will fund in the years ahead,” he added.
