Cagamas issues 11.7 billion ringgit of bonds, sukuk in 2020
Malaysian mortgager's fourth 10-billion-ringgit-plus year of issuance
21 Dec 2020 | The Asset

Cagamas, the national mortgage corporation of Malaysia, announced its latest bond issuance of 450 million ringgit (US$111.3 million), comprising 50-million-ringgit 2-year Islamic medium-term notes (IMTNs) and 400-million-ringgit 3-month conventional commercial papers (CCPs), the proceeds of which will be used to fund the purchase of house financing and loans from the financial system.

“We are pleased to conclude the year with yet another successful issuance, representing the company’s 22nd issuance exercise which brings the aggregate issuances for the year to 11.7 billion ringgit,” says Chung Chee Leong, Cagamas’ president and chief executive officer. “This marks the company’s fourth consecutive year surpassing 10 billion ringgit worth of issuances.

“It has been an eventful year with many unprecedented twists and turns. Economic turmoil associated with the Covid-19 pandemic has had a wide-ranging and severe impact on financial markets globally. Domestically, the Malaysian financial market remains resilient and continues to function efficiently despite the challenging global economic environment.

“The company remains vigilant during this period and will strive to navigate the impact of the pandemic through many efforts of reinvention, accelerating digital transformation and implementing various agile operating procedures to mitigate disruptions from the pandemic. We remain committed in our continuous efforts to fulfil our mandate as a financial intermediary between the capital market and the Malaysian housing sector.”

The IMTNs was priced at spread of 41 basis points (bp) above the corresponding Malaysia Government Investment Issues, while the CCPs were priced at the corresponding 3-month KLIBOR benchmark rate, plus 2bp or equivalent to 1.96% based on KLIBOR fixing on the pricing date, represented 26bp above the Malaysian treasury bills.

The papers, which will be redeemed at their full nominal value upon maturity, are unsecured obligations of the company, ranking pari passu and with all other existing unsecured obligations of the company. They will be listed and tradable under the Scripless Securities Trading System.

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