CIMB Islamic, StanChart Saadia enter US$227m Collateralised Commodity Murabahah transaction

Proceeds will be used for SDG-compliant projects.

CIMB Islamic Bank Bread has entered into an RM1b (around US$227m) landmark Sustainable Collaterized Commodity Murabahah (CCM) transaction with Standard Chartered Saadia Malaysia, the bank said in a press release.

CCM is a Shariah-compliant loan service secured with high-quality Islamic Sukuk assets. This provides the Islamic financial market with a viable alternative to the conventional Repurchase/Reverse-Repurchase Agreements, CIMB Islamic said.

All transaction proceeds of the CCM will be earmarked to eligible Shariah-compliant assets and projects that fall within the boundaries of CIMB Group’s Sustainable Development Goals Bond and Sukuk Framework. These include projects for affordable housing, start-ups and SMEs, public schools, and green projects such as green mass transit, climate resilient buildings and infrastructure, sustainable forestry and wildlife conservation projects.

CIMB Islamic and Standard Chartered Saadia were supported by the Financial Markets Association of Malaysia and Association of Islamic Banks in Malaysia in this transaction.

(US$1 = RM4.40)