KUALA LUMPUR, Kenanga Investment Bank Bhd (Kenanga IB) has successfully issued the first tranche of its Additional Tier 1 Capital Securities (AT1CS) amounting to RM40 million in nominal value. The issuance carries a perpetual tenure with a non-callable period of five years.
In a filing with Bursa Malaysia, Kenanga IB said the issuance forms part of its AT1CS Programme, which has a total size of up to RM500 million in nominal value. The securities offer a coupon rate of 5.75 per cent per annum, reflecting the bank’s efforts to strengthen its capital structure and maintain flexibility in funding.
The investment bank noted that the proceeds from this tranche will be channelled towards a variety of purposes, including capital expenditure, working capital needs, refinancing or settlement of existing borrowings, as well as other general corporate requirements.
Kenanga IB said the programme underscores its commitment to maintaining a healthy balance sheet and ensuring sufficient liquidity to support its business growth and expansion strategies. By tapping into the capital markets, the bank is positioning itself to enhance its resilience in a challenging financial landscape while creating a buffer for future investment opportunities.
The Additional Tier 1 Capital Securities, often used by banks to comply with regulatory capital requirements under Basel III standards, provide a means of raising long-term capital while diversifying funding sources. For Kenanga IB, the issuance also signals confidence in its outlook and stability, given the demand from investors for such securities despite their perpetual nature and subordinated status.
The group emphasised that this initial RM40 million issuance is only the beginning of a larger plan under the RM500 million programme, which will be carried out progressively depending on market conditions and funding needs.
