CIMB bags job for CDL sukuk issue

August 21, 2008
CIMB bags job for CDL sukuk issue

(KUALA LUMPUR) CIMB Group has won the mandate to arrange a $1 billion
Islamic bond issue for Singapore-listed property developer City
Developments Ltd (CDL), according to a report in Malaysia's Business
Times.

It will be Singapore's first sukuk-Ijarah unsecured financing
arrangement by a company, the paper pointed out.

A signing ceremony between CIMB Group unit CIMB-GK Securities Pte Ltd
and CDL is expected to be held this week in Singapore.

CDL is the property arm of Hong Leong Group Singapore.

The deal is significant for CIMB as it comes at a time when capital
market activities at home and in the region are slowing.

'This (new mandate) certainly helps it cushion some of the downside
arising in the debt market. It also highlights the competitive edge
that CIMB has over some global investment banks,' said an analyst
from a foreign research house in Kuala Lumpur.

CIMB is part of Malaysia's second largest banking group, Bumiputra-
Commerce Holdings Bhd, which last week reported a 7 per cent decline
in half-year net profit because of weaker capital markets.

CIMB group chief executive Nazir Razak had said at a results briefing
that he expects the weak markets to persist in the second half of the
year.

CDL, which is Singapore's second largest developer, said in a
statement last Thursday that it plans to make use of the $1 billion
Islamic multi-currency medium-term notes programme to tap new markets
and investors.

'This programme will provide the group with a diversified,
alternative and non-traditional financing stream to further enhance
its war chest,' executive chairman Kwek Leng Beng said.

It is understood that CDL's sukuk-Ijarah is expected to be listed on
the Singapore stock exchange sometime in the fourth quarter.