Malaysia SC Increases Gearing Limit for M-REITs

Source: Regulation Asia Editors, Regulation Asia 2020-08-13

The increase is temporary to provide Malaysian REITs greater flexibility to manage cash flows and debt and capital structures more efficiently.

Malaysia’s SC (Securities Commission) has announced that it will temporarily increase the gearing limit for Malaysian REITs from 50% to 60%, effective immediately, until 31 December 2022.

The temporary increase in gearing limit will provide M-REITs greater cash flow flexibility and allow M-REIT managers to manage their REIT debt and capital structures more efficiently, in light of the challenging operating environment during the Covid-19 pandemic.

Notwithstanding the temporary increase in gearing limit, the SC expects managers consider REIT sustainability and unit holders’ best interests before taking on any additional debt.

Securities Commission Malaysia

M-REITS

Malaysia SC Increases Gearing Limit for M-REITs

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