RAM Ratings reaffirms AA1 rating of RM360.0 million sukuk programme by Masraf Al Barakah's financing conduit
RAM Ratings reaffirms AA1 rating of RM360.0 million sukuk programme by Masraf Al Barakah's financing conduit
Transcription
- 31 /10/2016 Latest Announcement - (News ID : 2016103100029) Latest Announcement News ID : 2016103100029 Subject : Cendana Sejati Sdn Bhd Cendana Sejati Sdn Bhd Organisation Name: RAM RATING SERVICES BERHAD News Type: RATING ANNOUNCEMENT Reference Site: None Embargo Date: 31/10/2016 Embargo Time: 05:00 PM Expiry Date: 30/11/2016 Priority: Medium Summary: RAM Ratings reaffirms AA1 rating of RM360.0 million sukuk programme by Masraf Al Barakah's financing conduit Attachments: No attachment available. Disclaimer: The user, including a user who is also a FAST Participant, expressly agrees that the use of this website which is accessible at https://fast.bnm.gov.my/ is at the user's sole risk. The information contained in this FAST website is compiled by MyClear Sdn. Bhd. (MyClear) and is provided on an "as is" basis without any representations or warranties of any kind, either expressed or implied. While MyClear makes every effort to ensure that information contained in the FAST website are accurate and disseminated in a timely and efficient manner, the user acknowledges that delays, errors, omissions or inaccuracies may occur. MyClear disclaims any liability pertaining to the consequences of any delays, errors, omissions or inaccuracies arising out of or relating to the FAST website or information, including but not limited to, any decision made or action taken by a user in reliance upon such information, or for damages suffered, whether direct, consequential, special, punitive, indirect or otherwise, notwithstanding having been advised of the possibility of such damages. In the event of any dispute, the official records of MyClear shall prevail. MyClear, Bank Negara Malaysia or any of its affiliates, officers, directors, agents or any other party involved in creating, producing or delivering the FAST website, shall not be liable for any direct, consequential, special, punitive, indirect, incidental or other damages arising out of or in any way connected with the use or inability to use the FAST website or information, whether based on contract, tort, liability or otherwise, even if advised on the possibility of any such damages. Content RAM Ratings has reaffirmed the AA1/stable rating of Cendana Sejati Sdn Bhd's (Cendana) RM360.0 million Senior Sukuk Murabahah MTN Programme. The reaffirmation is premised on the available collateral cover supporting the Senior Sukuk under an AA1 stress scenario. The reaffirmation is also predicated on our expectation that the transaction's liquidity risk will remain proactively managed by the Originator, to ensure the timely redemption of all outstanding Senior Sukuk. While the previously highlighted liquidity shortfall has mostly been addressed with the recent issuance of a RM10.0 million 8year Senior Sukuk, we note that liquidity risk is still present, at least until the Senior Sukuk Programme is fully drawn down or the availability period expires. As at endJune 2016, the outstanding RM70.0 million of Senior Sukuk was supported by RM122.5 million of outstanding receivables and RM9.3 million in cash and permitted investments, in compliance with the minimum required balances. The resultant collateralisation ratio of 188% also reflects the cashflow falling outside the last maturing Senior Sukuk's tenure in the Originator's initial drawdown plans, and considers the potentially higher financing costs of issues under the Senior Sukuk Programme, with the weightedaverage profit rate (5.68%) of the outstanding Senior Sukuk keeping within our assumed stressed weightedaverage profit rate of 6.35%. As of endJune 2016, there was no incidence of prepayment or default, although portfolio wide delinquencies can be observed, mainly due to a revision in the salary payment dates of civil servants. While Masraf Al Barakah Sdn Bhd's (Masraf) servicing responsibilities had been largely met, we note some data inconsistencies in the monthly servicer reports. On the other hand, there was also an improvement in the timeliness of fund transfers from the Collection Account to the Liquidity Reserve Account. As these hiccups had been immaterial and have since been resolved, we expect Masraf's servicing quality to remain satisfactory. https://fast.bnm.gov.my/fastweb/public/PublicInfoServlet.do?chkBox=2016103100029&mode=DISPLAY&info=NEWS&screenId=PB010400 1/1
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