UOB Malaysia successfully prices RM750m Basel III-compliant Tier 2 MTN


UNITED Overseas Bank (Malaysia) Bhd (UOB Malaysia) has successfully priced an offering of RM750 million Tier 2 subordinated medium term notes (MTN) due August 2030 and callable in August 2025 at a fixed coupon rate of three per cent per annum.

The pricing is at the tight end of price guidance and is also the lowest coupon ever achieved to-date for a ringgit-denominated Basel III-compliant subordinated Tier 2 transaction, the bank said in a statement today.

Rated AA1 by RAM Rating Services Bhd, the subordinated debt offering saw strong demand, with the issuance size increased from the initial target of RM600 million to RM750 million and oversubscribed more than two times.

Orders in excess of RM1.5 billion were received from 25 quality institutional investors, including insurance companies, fund managers, banks and private banks.   

UOB Malaysia chief executive officer Wong Kim Choong said the successful transaction reflected investors’ confidence in UOB Malaysia’s strong credit profile and robust business fundamentals against the backdrop of a challenging business environment and the impact of the COVID-19 pandemic.

“We will continue to deepen our presence and to sharpen our capabilities in support of our customers,” he added.

CIMB Investment Bank Bhd, HSBC Bank Malaysia Bhd and UOB Malaysia acted as Joint Lead Managers for this transaction.