RAM Ratings reaffirms AAA(s) rating of KLIA Berhad’s Islamic Notes Facility

Published on 21 October 2013

RAM Ratings has reaffirmed the AAA(s)/Stable rating of KL International Airport Berhad’s (KLIA Berhad or the Company) RM4.06 billion Government-Guaranteed Bai’ Bithaman Ajil Notes Issuance Facility (2003/2015) (KLIA Notes Facility). The debt issue is guaranteed by the Government of Malaysia (GoM) (rated AAA(pi)/Stable/P1(pi)). As such, the enhanced rating reflects the credit profile of the GoM.

Incorporated on 29 May 1993, KLIA Berhad is wholly-owned by the GoM via the Ministry of Finance (Incorporated) (MoF). The Company had been set up as a funding conduit to enable the GoM to finance the construction and development of Kuala Lumpur International Airport (KLIA).

Upon the completion of KLIA in 1998, the ownership and all outstanding liabilities of the airport had been transferred to the MoF. In 1999, however, the GoM had advised the Company to reinstate outstanding liabilities in relation to the construction of the airport. At that time, the outstanding liabilities had comprised loans from various entities, including the KLIA Notes Facility. KLIA Berhad has since been responsible for the repayment of all outstanding liabilities, while the MoF undertakes to provide all necessary funding to settle these commitments.

As of end-June 2013, RM3.00 billion of the RM4.06 billion Primary Notes issued had been redeemed while RM1.28 billion of the RM2.04 billion of Secondary Notes issued had been repaid.

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Fam Pei Xin

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peixin@ram.com.my