Business

Friday October 30, 2009

Sabah to be first state to issue bonds


KUALA LUMPUR: Sabah’s bond issuance of up to RM544mil in nominal value marks the first foray of any state government in the ringgit bond market.

The Sabah government yesterday held an investor presentation of its proposed inaugural bond issue which has been accorded the highest long-term “AAA” rating by RAM Rating Services Bhd.

The state government intended to utilise the proceeds of the five-year bond issue to part-finance the state’s working capital requirements and general investment activities, a statement said yesterday.

“Sabah has made significant progress over the last decade, making it now a land of abundant opportunities and development.

“The state government has prospered over recent years from its forward looking policies towards development,” said Sabah Assistant Minister of Finance Datuk Tawfiq Abu Bakar Titingan.

With this issuance, he said the state government would effectively diversify its sources of funding via the ringgit debt market.

The statement said Tawfiq led a team of senior state government officers to meet with investors here comprising Assistant Finance Minister II Donald Mojuntin, Permanent Secretary of the Ministry of Finance, Sabah, Datuk Yusof Kassim and other key officials.

CIMB Investment Bank Bhd is the sole lead manager, arranger and bookrunner for the proposed issuance. Sabah Development Bank Bhd is the co-arranger and Barclays Capital Markets Sdn Bhd is the financial advisor for this transaction. — Bernama

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