RHB Bank raises RM3 billion under MTN Programme to repay bonds and for working capital

Kuala Lumpur, October 23, 2007:RHB Bank Bhd ("RHB Bank") will raise a total of RM3 billion under a Medium Term Note Programme ("MTN Programme") to repay existing subordinated debts and for working capital.

The Programme, lead arranged by RHB Investment Bank Bhd ("RHB Investment Bank"), will see RHB Bank issue subordinated notes and/or senior notes to repay its existing subordinated bonds of RM800 million which are due in December 2007. The balance of the sum raised will be utilised for general working capital of the bank and its subsidiaries, which include RHB ISLAMIC Bank Bhd.

RHB Investment Bank is also principal advisor for the Programme.

The first tranche of subordinated notes, amounting to RM2 billion and carrying both a 15-year non-callable 10 years and a 10-year non-callable five years structure to cater to different needs of investors, is scheduled for November 2007, RHB Bank announced at a briefing for investors here today.

RHB Bank is expected to embark on a road-show to market the subordinated notes to regional fixed income investors in early November 2007. The financial institution will be joined on the road-show by joint bookrunners ABN Amro Bank Bhd and co-manager Citibank Bhd.

Rating agency RAM Rating Services Bhd has accorded the subordinated notes a rating of A1. In addition, the bank's long and short-term general bank ratings have been reaffirmed at AA3 and P1 respectively with a positive outlook.

The programme has a 20-year tenure, during which RHB Bank has the option to issue subordinated notes with maturities ranging from 10 to 20 years from the date of issue and callable after a minimum period of five years, or senior notes with maturities ranging from one to 20 years from the date of issue.

The Programme will cater for the foreseeable Tier 2 capital requirements of the Bank and maintain its Risk Weighted Capital Adequacy Ratio at a healthy level of above 12%. In addition, the Programme is expected to result in interest cost savings.

RHB Capital Bhd, the holding company of the Bank, recently announced its transformation programme that would see a significant change in the organisational and reporting structure of the companies within RHB Banking Group. Business would be conducted through strategic business units comprising retail, corporate investment banking, Islamic and international, which will operate alongside four strategic functional units - operations and support, finance, risk management and human resources.

The transformation will enable the RHB Banking Group to adopt a customer-centric approach by focusing on meeting the market demands for personalised, customer-oriented banking services and improving its operational efficiencies and providing better and improved services.