FGV Audited Financial Statements 2020

44 BORROWINGS (CONTINUED) The maturity profile of borrowings are as follows: Group Company Finance rate Effective finance rate at date of statement of financial position per annum % Finance rate Effective finance rate at date of statement of financial position per annum % 2020 Islamic short term trade financing Fixed 1.90 – 4.22 Fixed 2.65 – 3.83 Short term trade financing Fixed 0.60 – 6.87 - - Islamic term loans Floating 3.76 – 5.44 - - 2019 Islamic short term trade financing Fixed 1.26 – 5.60 Fixed 3.83 – 4.11 Short term trade financing Fixed 2.60 – 6.87 - - Islamic term loans Floating 5.24 – 6.43 - - Term loans Floating 6.30 – 6.40 - - The secured term loans consist of the following: (i) RM873,390,000 (2019: RM873,893,000) Islamic term loans is secured against a leasehold land, debenture and certain bank balances of the Group. (ii) RM Nil (2019: RM71,909,000) term loan which has a tenure of 30 months is secured against an assignment of proceeds from land disposal and the Assignment and Charge of the Designated Accounts. The secured short term trade financing consists of the following: (i) RM32,254,000 (2019: RM33,522,000) short term trade financing is secured over certain property, plant and equipment, benefits of an insurance covering finished goods, and guaranteed by some of the directors and/or shareholders of certain subsidiary companies. Islamic term loans MSM Malaysia Holdings Berhad (“MSMH”), a subsidiary of the Company is required to comply with certain financial covenants i.e. consolidated net debt and financing to equity ratio, consolidated net debt and financing to earnings before interest, tax, depreciation and amortisation (“EBITDA”) ratio and consolidated finance payment cover ratio (collectively known as ‘’financial covenants”). The financial covenants are to be complied with annually (2019: annually). On 10 December 2020, MSHM had obtained a consent letter from its lender to defer the imposition of all the financial covenants for financial year ending 31 December 2020. The imposition is conditional upon MSMH obtaining an official valuation report addressed to its lender on a land leased by the MSMH and a prepayment of RM40,000,000. These conditions have been confirmed as fulfilled by the lender on 28 December 2020. As a result of the prepayment, the MSMH had recorded a loan modification credit of RM11,695,000. Term loan In previous financial year, MSMH’s term loans, which had a tenure of 30 months (2019: 30 months) were secured against an assignment of proceeds from leasehold agriculture land disposal and the Assignment and Charge of the Designated Accounts. This loan had been repaid in full during the year ended 31 December 2020. 163 Notes to the Financial Statements For The Financial Year Ended 31 December 2020 Audited Financial Statements 2020