KUALA LUMPUR: The Securities Commission (SC) has expanded its Green SRI Sukuk Grant Scheme and renamed it as SRI Sukuk and Bond Grant Scheme.
The SC said the grant was now applicable to all sukuk issued under its Sustainable and Responsible Investment (SRI) Sukuk Framework or bonds issued under the Asean Green, Social and Sustainability Bond Standards (Asean Standards).
With a size of RM6 million, the grant was established in 2018 to assist issuers in defraying up to 90 per cent of the external review costs for green SRI sukuk.
"Thus far, it has benefitted eight issuers involved in renewable energy, green building and sustainable projects," it said.
The SC chairman Datuk Syed Zaid Albar said as a regional leader in sustainable and responsible investment, Malaysia's capital market offered companies efficient and reliable access to financing of sustainable projects.
"This can positively contribute to the environment and society, in alignment with the country's commitment to the sustainable development goals and the climate change agenda," said Syed Zaid.
Already recognised as a pioneer in Islamic finance and more recently for climate-friendly sukuk offerings, Malaysia made up 19 per cent of sukuk and bonds issued under the Asean Standards.
According to the SC, as at December last year, RM5.4 billion had been issued under the SRI Sukuk Framework.
Of this, 58 per cent or RM3.1 billion are recognised under the Asean Standards, and another RM635 million bonds issued under the Asean Standards.
"This signifies the demand for an asset class that meets the criteria for Shariah as well as sustainable and responsible investing," it said.
Thhe SC also said eligible issuers can claim the grant to offset up to 90 per cent of the external review costs incurred, subject to a maximum of RM300,000 per issuance.
"Income tax exemptions are provided for the recipients of the scheme for a period of five years until 2025 as announced in 2021 Budget," it added.