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Alliance Bank Successfully Issues RM1.2 Billion Tier-2 Subordinated Medium Term Notes

Kuala Lumpur, 27 October 2020 - Alliance Bank Malaysia Berhad (“Alliance Bank”) has successfully issued RM1.2 billion Basel III-compliant Tier 2 Subordinated Medium Term Notes (“Sub-MTNs”) under its existing RM2 billion Sub-MTN Programme.

The Sub-MTNs were issued in three tranches with maturities between 10 and 15 years. Alliance Bank has the option to redeem the Sub-MTNs five years before their stated maturities.

Alliance Bank has RM1.2 billion of existing Sub-MTNs comprising a RM900 million tranche and a RM300 million tranche that are callable on 27 October and 18 December this year respectively.

During the book-building exercise, only RM900 million Sub-MTNs were offered initially to investors to replace the Sub-MTNs that were callable in October 2020. Due to overwhelming demand from investors with more than 2 times book cover, the Bank decided to upsize the offerings bringing the total issue size to RM1.2 billion in a single tap. The auction closed with the Sub-MTNs priced competitively between 3.60% p.a. and 4.05% p.a.

“The success of this transaction reflects investors’ confidence in Alliance Bank’s financial strength and long-term prospects. We are pleased that they recognise the Bank’s efforts in helping our customers weather the current pandemic while keeping the Bank safe,” said Mr. Joel Kornreich, Group Chief Executive Officer of Alliance Bank.

“As the Lead Arranger for this transaction, we wish to congratulate Alliance Bank on its successful issuance which was well received by both the large institutional funds and high net worth individuals. The transaction demonstrates the resilience of the Malaysian debt capital markets, which remains a viable option to companies to diversify their funding sources. While investors remain selective, there is currently ample liquidity available and investors are looking for bonds or sukuk with strong credit ratings to stabilise their portfolio returns,” said Mr Michael Ng, Chief Executive Officer of Alliance Investment Bank.

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