View Credit Analysis Report (605243)

Date Article2020-09-01 00:00:00
MARC has affirmed its AAAIS rating on Aman Sukuk Berhad’s (Aman) Islamic Medium-Term Notes (IMTN) programme of up to RM10.0 billion with a stable outlook. The outstanding IMTN under the rated programme stood at RM4.07 billion as at May 31, 2020.

Aman is a wholly-owned funding vehicle of PBLT Sdn Bhd (formerly known as Pembinaan BLT Sdn Bhd), the developer of 74 projects comprising quarters and facilities for Polis Diraja Malaysia (PDRM). The projects, which are located throughout the country, were developed under a build, lease and transfer (BLT) model. Upon completion of each project, PBLT had entered into irrevocable lease and sublease agreements with the Malaysian government.

The affirmed rating and outlook reflect the credit strength of the Malaysian government as the sole paymaster of the sublease rental payments that are sufficient to meet the principal and profit payments under the IMTN programme. MARC expects the sublease rental stream to continue being supported by the Malaysian government on a timely basis under the lease and sublease agreements.

Proceeds from the IMTN, which have been issued in seven independent series, were used to acquire the rights to sublease rental receivables of the said developments from PBLT. The sublease rental payments were structured to meet the repayment profile of each series for the IMTN issued. As at end-May 2020, the cash balance in Aman’s security accounts of about RM1.9 billion is more than sufficient to meet its financial obligations comprising profit payments of RM90.2 million in 2020 and IMTN redemptions totalling RM850.0 million under Series 1, 2 and 6 in 2021.

Major Rating Factors

Predictable and sufficient sublease rental payments to meet financial obligations; 
Credit strength of the Malaysian government as the sole paymaster; and
Irrevocability of the government’s sublease obligations.

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