[MARC] MARC Ratings affirms Chailease Berjaya’s AA-(cg) rating

MARC Ratings has affirmed its rating of AA-(cg)/Stable on Chailease Berjaya Credit Sdn Bhd’s (CBC) RM1.0 billion Medium-Term Notes (MTN) Programme. The programme is unconditionally and irrevocably guaranteed by CBC’s ultimate holding company, Chailease Holding Company Limited (CHC). Accordingly, the rating reflects the credit strength of CHC which carries a public information rating of AA-/Stable.

MARC Ratings notes that CBC has sustained strong operating performance, achieving double-digit growth from 2017 to 2024, and is projected to sustain this momentum through 2026. Asset quality remained stable, with the gross impaired loans (GIL) ratio easing to 1.3% as of 1H2025 and loan loss coverage of 214.7% providing a solid buffer against credit losses.

Overall profitability improved in 2024, driven by loan growth and sustained double-digit net interest margins (NIM), supported by high-margin motorcycle and used-car financing. Pre-tax profit rose 66% to RM150.0 million (2023: RM90.1 million), with 1H2025 profit also increasing to RM92.4 million (1H2024: RM64.4 million). Interest income is expected to strengthen further in the near-to-medium term on continued loan growth and robust NIM.

CBC relies mainly on short- to medium-term bank borrowings for its financing, which have grown in line with its assets, reaching RM2.6 billion in 1H2025 (2024: RM2.5 billion). Besides the MTN programme, these borrowings are guaranteed by CHC. The company’s debt-to-equity ratio has remained stable at 3.8x.

The parent’s rating reflects its strong market position and long leasing track record, though asset quality faces pressure. In 1H2025, CHC’s consolidated loan book reduced by 6% to TW$705.0 billion (RM101.7 billion) amid macroeconomic uncertainty, pushing the GIL ratio to 4.4%. Asset quality is expected to remain challenged in the near term due to higher delinquencies in key markets, namely Taiwan, Thailand, and China, though loan loss coverage of 65.6% remains adequate. The group reported a stable NIM of 7.6%, with annualised return on assets and return on equity of 3.2% and 17.2%. Performance was weighed down by a contracting loan book, partly due to tighter regulations in Taiwan’s high-margin used-car business, but overall metrics remain healthy.

Darren Leong, +603-2717 2937/ darren@marc.com.my
Ahmad Affan, +603-2717 2946/ ahmadaffan@marc.com.my
Amirah Aisyah, +603-2717 2969/ amirah@marc.com.my
Elmer Lim, +603-2717 2947/ elmer@marc.com.my