HONG KONG (13 October 2016) – Export-Import Bank of Malaysia Berhad (“MEXIM”) successfully priced its USD500.0 million 5-year, senior unsecured notes (the “Notes”) offering at 120 basis points over U.S. Treasuries (“UST”) at a fixed coupon of 2.48%. This offering marks MEXIM’s third USD-denominated public offering issuance, following MEXIM’s successful inaugural senior USD Notes issuance in 2012 and senior USD Sukuk issuance in 2014. The pricing for the landmark offering marks the lowest ever historical credit spread for MEXIM’s publicly-offered USD Notes, the lowest coupon ever achieved by MEXIM as well as the lowest coupon achieved by a Malaysian issuer in 2016 for a similar tenor. The Notes will be issued pursuant to MEXIM’s recently upsized USD3.0 billion Multicurrency Medium Term Note Programme.
The 5-year Notes were offered based on the Regulation S format under the U.S. Securities Act 1933, as amended, and are expected to be rated A3 by Moody’s Investors Service, Inc. and A- by Fitch Ratings Ltd. Proceeds from the offering will be utilised for MEXIM’s general banking and financing activities, working capital as well as other corporate purposes. The Notes are expected to be listed on the Singapore Exchange Securities Trading Limited and the Labuan International Financial Exchange Inc.
The Notes offering followed a series of fixed income investor meetings in Asia and conference calls with European accounts from 10 October 2016 to 12 October 2016. Based on strong investor feedback, the bookbuilding exercise commenced with an initial price guidance of UST + 1.400% area. Demand for the Notes offering led to a final price guidance of UST + 1.200% – 1.250% at Asian close. The Notes were finally priced at London mid-day at the tight end of the final price guidance, with a final book of over USD1.4 billion orders, representing a bid-to-cover ratio of over 2.8 times, and a final yield of 2.480%.
The Notes attracted interest from 79 accounts from a diverse group of investors comprising Asian investors who accounted for 88% of the total allocation, while Malaysian investors accounted for 8%, and the balance of 12% were allocated to EMEA investors. By investor type, the offering saw majority participation from fund managers 67%, banks 23% and insurance companies 8%. The balance 2% were allocated to other investor classes.
“We are pleased with the outcome of the transaction. MEXIM took advantage of the conducive market conditions and launched our transaction which received overwhelming support from investors. The tight pricing achieved by MEXIM, the level of subscription and diversification of investors in the offering is a testament of investors’ confidence in MEXIM’s strong credit position and our unique role as Malaysia’s only development financial institution dedicated to promoting the development of cross-border business ventures”, says Norzilah Mohammed, President / Chief Executive Officer of MEXIM.
CIMB Bank (L) Limited and The Hongkong and Shanghai Banking Corporation Limited acted as the Joint Global Coordinators for the offering, and, together with Maybank Investment Bank Berhad and Nomura International plc, acted as the Joint Bookrunners and Joint Lead Managers for the offering.