General Announcement

26/07/2004

CIMB BERHAD (CIMB OR COMPANY) PROPOSED COMMERCIAL PAPERS (CPS) ISSUANCE PROGRAMME (CP PROGRAMME) AND MEDIUM TERM NOTES (MTNS) ISSUANCE PROGRAMME (MTN PROGRAMME) WITH AGGREGATE ISSUANCE LIMIT OF UP TO RM250,000,000 NOMINAL VALUE CPS AND/OR MTNS (PROPOSED CP PROGRAMME AND MTN PROGRAMME)

CIMB BERHAD

Type

Announcement
SubjectCIMB BERHAD (CIMB OR COMPANY)

PROPOSED COMMERCIAL PAPERS (CPS) ISSUANCE PROGRAMME (CP PROGRAMME) AND MEDIUM TERM NOTES (MTNS) ISSUANCE PROGRAMME (MTN PROGRAMME) WITH AGGREGATE ISSUANCE LIMIT OF UP TO RM250,000,000 NOMINAL VALUE CPS AND/OR MTNS (PROPOSED CP PROGRAMME AND MTN PROGRAMME)

Contents :

1. INTRODUCTION

      CIMB is pleased to announce that the Company proposes to implement the Proposed CP Programme and MTN Programme.


2. DETAILS OF THE PROPOSED CP PROGRAMME AND MTN PROGRAMME
      2.1 The aggregate outstanding nominal value of the CPs and the MTNs (collectively the "Notes) issued under the CP Programme and the MTN Programme respectively shall not exceed RM250 million at any point in time.

      2.2 The tenure for the CP Programme is seven (7) years from the date of the first issue under the CP Programme. During the tenure of the CP Programme, the Company may issue CPs with maturities of between one (1), two (2), three (3), six (6), nine (9) or twelve (12) months as the Company may select, provided that the CPs mature prior to the expiry of the CP Programme.
          The tenure of the MTN Programme is ten (10) years from the date of first issue under the MTN Programme. During the tenure of the MTN Programme, the Company may issue MTNs with maturities of more than one (1) year to ten (10) years provided that the MTNs mature prior to the expiry of the MTN Programme.

          The indicative principal terms and conditions of the Proposed CP Programme and MTN Programme are as set out in Table 1.
      2.3 The proceeds to be raised from the issuance of the Notes under the proposed CP Programme and/or MTN Programme will be utilised for (i) refinancing the borrowings of CIMB, (ii) financing asset acquisitions and other capital expenditures by CIMB and its subsidiaries (CIMB Group) and (iii) for working capital requirements of the CIMB Group.
      2.4 The CPs and MTNs will be rated by Rating Agency Malaysia Berhad.


3. RATIONALE FOR THE PROPOSED CP PROGRAMME AND MTN PROGRAMME
      The Proposed CP Programme and MTN Programme will provide the Company with an alternative source of financing which will enable the Company to better plan and manage its funding costs, funding requirements and capital allocation.


4. EFFECTS OF THE PROPOSED CP PROGRAMME AND MTN PROGRAMME
      4.1 Share Capital, Substantial Shareholders Shareholdings, Net Tangible Assets (NTA) and Earnings
          The Proposed CP Programme and MTN Programme will not have any effect on the issued and paid-up share capital, shareholdings of the substantial shareholders of CIMB, NTA per share of the CIMB Group, and is not expected to have any material effect on the earnings per share of the CIMB Group.
      4.2 Dividends
          For the financial year ended 31 December 2003, the Board of Directors of CIMB proposed a special dividend of 21.29 sen per share, less income tax at 28%, on 850,000,000 shares, amounting to RM130,294,800 and a final dividend of 10 sen per share, less income tax at 28% on 851,844,314 shares amounting to RM61,332,791. As an integral part of improving its capital management, CIMB had earlier announced an annual gross dividend target rate of 15 sen per share.
          The Board of CIMB does not expect the Proposed CP Programme and MTN Programme to affect the dividend target of the Company.


5. CONDITIONS OF THE PROPOSED CP PROGRAMME AND MTN PROGRAMME

      The Proposed CP Programme and MTN Programme is subject to and conditional upon approval being obtained from the Securities Commission (SC).


6. DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS
      None of the Directors, major shareholders of CIMB and/or persons connected to them has any interest, direct or indirect, in the Proposed CP Programme and MTN Programme.


7. DIRECTORS RECOMMENDATION
      The Board of CIMB, after careful deliberation, is of the opinion that the Proposed CP Programme and MTN Programme is in the best interest of the Company.

8. TIMING OF SUBMISSION
      An application to the SC is expected to be made within six (6) weeks from the date of this announcement.

This announcement is dated 26 July 2004.
Table 1: Summary of Salient Principal Terms of the Proposed CP Programme and MTN Programme

Issuer:CIMB Berhad
Facility and Amount:A commercial papers (CPs) issuance programme and a medium term notes (MTNs) issuance programme (CP Programme and MTN Programme respectively) which is to be arranged by the Lead Manager on a best effort basis.

The aggregate outstanding nominal value of the CPs and the MTNs issued under the proposed CP Programme and the MTN Programme respectively shall not exceed RM250 million at any point in time.
Adviser/Lead Manager/
Lead Arranger		:Commerce International Merchant Bankers Berhad
Purpose:The proceeds to be raised from the issuance of the Notes under the proposed CP Programme and/or MTN Programme will be utilised for (i) refinancing the borrowings of the Issuer, (ii) financing asset acquisitions and other capital expenditures by the Issuer and its subsidiaries (CIMB Group) and (iii) for working capital requirements of the CIMB Group.
Tenure:CP Programme
Seven (7) years from the date of the first issue under the proposed CP Programme.

MTN Programme
Ten (10) years from the date of the first issue under the proposed MTN Programme.
Maturity:CPs - One (1), two (2), three (3), six (6), nine (9) or twelve (12) months as the Issuer may select, provided that the CPs mature prior to the expiry of the proposed CP Programme.

MTNs - More than one (1) year to ten (10) years as the Issuer may select, provided that the MTNs mature prior to the expiry of the proposed MTN Programme.
Rating Agency:Rating Agency Malaysia Berhad
Rating:CPs
The rating for the CPs shall be P1 on their respective issue date.

MTNs
The rating for the MTNs shall be at least A1 for the MTNs on their respective issue date.
Issue Price:CPs
The CPs shall be issued at a discount and the issue price is calculated in accordance with the Rules on Fully Automated System for Issuing / Tendering (FAST) issued by Bank Negara Malaysia (BNM), as amended or substituted from time to time (FAST Rules).

MTNs
The MTNs are to be issued at par or at a discount and the issue price is calculated in accordance with the FAST Rules.
Interest /Coupon/Profit or equivalent rate (%):To be determined at the time of issue.
Security:None.
Financial Covenants:The Issuer shall maintain a Debt to Equity ratio of not more than 1:1 at all times, where:

(a) Debt means all indebtedness for borrowed moneys, hire purchase obligations, finance lease obligations, letters of credits or guarantees issued for the account of the Issuer, the net exposure determined on a marked to market basis under hedging agreements (if any) and any third party borrowings by the Issuer; and

(b) Equity means the total shareholders funds of the Issuer including subordinated advances and loans from its shareholders (if any), less intangibles (if any).
Listing Status:The CPs or MTNs will not be listed on the Bursa Malaysia Securities Berhad or any other stock exchange.
Transferability:Transferable, but subject to the selling restrictions described below.
Selling Restrictions at Issuance:The CPs or MTNs may only be offered, sold, transferred or otherwise disposed directly or indirectly to a person to whom an offer or invitation to subscribe the CPs or MTNs and to whom the CPs or MTNs are issued would fall within Schedule 2 or Section 38(1)(b) and Schedule 3 or Section 39(1)(b) of Securities Commission Act 1993 as amended from time to time ("SCA") and would fall within Schedule 5 or Section 66(3) of the SCA.
Selling Restrictions Thereafter:The CPs or MTNs may only be offered, sold, transferred or otherwise disposed directly or indirectly to a person to whom an offer or invitation to purchase the CPs or MTNs would fall within Schedule 2 or Section 38(1)(b) of SCA and would fall within Schedule 5 or Section 66(3) of the SCA.
Redemption:Unless previously redeemed or purchased and cancelled, the CPs or MTNs will be redeemed by the Issuer at 100% of their nominal value on their respective maturity dates.
Governing Laws:Laws of Malaysia.







Announcement Info

Company NameCIMB BERHAD  
Stock Name CIMB
Date Announced26 Jul 2004  
CategoryGeneral Announcement
Reference NoMM-040721-43064

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