Serba Dinamik Annual Report 2018

237 SERBA DINAMIK HOLDINGS BERHAD ANNUAL REPORT 2018 16. Loans and borrowings (continued) (i) Security (continued) The term loans of the Group are secured by the following: (a) general and supplemental facility agreement. (b) first and second legal charges over leasehold land and certain buildings of the Group (see Note 3.2). (c) legal charges over plant and machinery as well as tools and equipment of the Group (see Note 3.2). (d) legal charges over assets belong to the Directors of the Group. (e) corporate guarantee from the Company. Finance lease liabilities of the Group are secured on the respective finance lease assets (see Note 3.2). The revolving credits (Islamic) of the Group are secured by the following:- (a) secured by pledged term deposits (see Note 6 and 13); (b) corporate guarantee from the Group or the Company. (ii) Significant covenants on loans and borrowings The Group is required to maintain a gearing ratio not exceeding 2.00 times in respect of the banking facilities granted by five licensed banks to the Group. The total outstanding borrowings of the Group with the said banks as at 31 December 2018 are RM283,698,523. The Group has not breached the covenant. The Islamic term loans, bank overdrafts and revolving credits facilities of RM314,651,000 (2017: RM17,113,000), RM3,281,000 (2017: RM3,537,000) andRM568,512,000 (2017: RM592,440,000) respectively are for Islamic facilities under Bai’ Inah and Murabahah contract. TheGroup and theCompany has issued and finalized a SukukWakalah programme, and raised approximately RM810 million for the purpose of general working capital and refinancing of existing debts with tenure of 5 and 10 years, payable semi-annually, and with maturity on 2023 and 2028 respectively. The Group is required to maintain a debt to equity ratio not exceeding 1.25 times throughout the tenure of Sukuk Wakalah Programmes. The Group has not breached the covenant. N O T E S T O T H E F I N A N C I A L S TAT E M E N T