The rating agencys said on April 10 the affirmed ratings of the Class A and Class B Sukuk Ijarah reflected the satisfactory performance of the securitised plantation assets.

"The stable outlook on the ratings reflect expectations that the estates performance will remain within MARC’s assessed sustainable net operating income (NOI) of RM42.0 million and long term CPO price assumption of RM1,500 tonnes amidst the continuing volatility of the crude palm oil (CPO) prices.

"Nevertheless, continued deterioration of CPO prices below our long term price assumption resulting in the actual NOI of the estates falling below MARC’s assessed sustainable NOI may lead to downward pressure on the outlook of the ratings," it said.

TPC, wholly-owned by Tradewinds, was incorporated for the sole purpose of issuing RM210.0 million Sukuk Ijarah and RM190.0 million Murabahah CP/MTN, the proceeds of which were used to purchase a pool of plantation assets - 12 estates and three palm oil mills - from Tradewinds’ nine subsidiaries (sellers/lessees).

 The assets were then leased back to the sellers under separate Ijarah agreements with the lease payments forming the source of repayment for the issued securities.  The lease payments match the Sukuk (i.e. principal) and return (i.e. profit) payment obligations under the Sukuk Ijarah while the CPs - the credit-linked class - are serviced by Tradewinds directly.