In its announcement to Bursa Malaysia Securities Berhad, BHB said the proposed restructuring would involve five components. They are:

1. A Proposed Placement (Placement) of new BHB shares to raise RM800 million. The proceeds together with internal cash will be used to fully settle BHB’s outstanding sukuk, held by Lembaga Tabung Haji (“LTH”).

2. A Scheme of Arrangement (SOA) by BHB to settle its outstanding warrants, whereby the BHB warrant holders would be paid a cash consideration for the cancellation of exercise rights in respect of the warrants.

3. An Internal Reorganisation, whereby BHB will dispose its entire equity interests in its stockbroking and leasing subsidiaries to Bank Islam, to be settled in cash. The consideration for these disposals will be based on the latest audited net asset value of these subsidiaries.

4. Distribution and Capital Repayment.
   After the completion of the Placement, the SOA, the Internal Reorganisation, BHB’s entire shareholdings in Bank Islam and Syarikat Takaful Malaysia Keluarga Berhad (STMKB) will be distributed by way of distribution-in-specie to the shareholders of BHB.

   Prior to the proposed distribution and capital repayment, BHB will undergo a capital reduction and Bank Islam will undertake a share consolidation. This is to match BHB’s outstanding shares so that the distribution of Bank Islam shares will be on a one-for- one basis.

   The basis of distribution and entitlement of STMKB shares will be determined at a later date.

5. Listing of Bank Islam.
   On completion of the Distribution-in-specie, BHB shareholders will hold a direct equity interest in Bank Islam and STMKB shares in proportion to their shareholding in BHB.

   BHB’s listing status will then be transferred to Bank Islam, which will emerge as the one and only pure-play full-fledged Islamic financial institution to be listed in the region and enhance its corporate stature.

In 1992, Bank Islam was first listed on Bursa Malaysia Securities before BHB was formed in 1997 to replace the Bank as the holding company of the Group, thus becoming the Group’s listing vehicle.

This listing will allow Bank Islam to better position itself in the Islamic finance and Islamic capital market and capitalise on the growth of both markets in its efforts to expand its customer base.