Perbadanan Bekalan Air Pulau Pinang Sdn Bhd (PBAPP) has officially launched its inaugural RM5 billion Islamic Medium-Term Notes (IMTN) Programme, aimed at accelerating the development of essential water infrastructure and ensuring long-term water security in Penang.
The Sukuk Programme, structured under the Shariah-compliant Sukuk Wakalah model, was introduced in conjunction with the unveiling of PBAPP’s new Sustainable Finance Framework. Penang Chief Minister Chow Kon Yeow, who also serves as Chairman of PBAPP, underscored the importance of the initiative in supporting strategic, sustainability-aligned financing.
“This dynamic financing platform enables PBAPP to intensify investment in critical water infrastructure projects while affirming the state’s commitment to sustainable development,” he said at the launch event.
The Sukuk Programme has been accorded the highest possible credit rating of AAA/Stable by RAM Rating Services Bhd. Simultaneously, PBAPP’s Sustainable Finance Framework has received a Gold Sustainable Finance Rating from RAV Sustainability Sdn Bhd, underscoring the organisation’s credibility in the environmental, social, and governance (ESG) financing space.
United Overseas Bank (UOB) Malaysia and Maybank Investment Bank Bhd (Maybank IB) have been appointed joint principal advisers, joint lead arrangers, and joint lead managers for the Sukuk issuance. Maybank IB also assumes the role of sole sustainability structuring adviser for PBAPP’s Sustainable Finance Framework.
Funds raised through the Sukuk will be channelled towards financing PBAPP’s Water Contingency Plan 2030 (WCP 2030), in addition to supporting broader capital and operational expenditure, refinancing requirements, and other green and social initiatives aligned with the Sustainable Finance Framework.
PBAPP marks a milestone as the first Penang state-linked agency to establish both a Sukuk programme and a Sustainable Finance Framework.
Commenting on the issuance, Andy Cheah, UOB Malaysia Country Head of Wholesale Banking, said the initiative reflects the pivotal role financial institutions play in mobilising capital for sustainable infrastructure financing.
Maybank IB Chief Executive Officer Michael Oh-Lau added that Malaysia’s debt capital markets, among the most developed and liquid in the region, offer strong investor support. With over RM120 billion in private debt securities issued annually, he noted consistent year-on-year growth in sustainability-labelled instruments.
“PBAPP is now well-positioned to leverage the depth and diversity of investor liquidity, benefit from competitive pricing, and enhance long-term funding flexibility through this Sukuk Programme,” Oh-Lau said.
-Bernama
