Caga­mas is­sues RM350m CMTN

The Sun (Malaysia) - - SUNBIZ -

KUALA LUMPUR: Caga­mas Bhd, the Na­tional Mort­gage Cor­po­ra­tion of Malaysia, yes­ter­day an­nounced the is­suance of its two-year con­ven­tional medium term notes (CMTN) amount­ing to RM350 mil­lion.

Pro­ceeds from the is­suance will be used to fund the pur­chase of hous­ing loans from the fi­nan­cial sys­tem.

“De­spite the un­cer­tainty in global mar­kets ahead of the US pres­i­den­tial elec­tions and the Fed­eral Open Mar­ket Com­mit­tee (FOMC) rate de­ci­sion in early Novem­ber, which in­flu­ences mar­ket par­tic­i­pants to weigh the pos­si­bil­ity of an in­ter­est rate hike in the up­com­ing meet­ing, the two-year CMTN was suc­cess­fully con­cluded at a com­pet­i­tive yield of 3.42%, rep­re­sent­ing a spread of 10 ba­sis points over the two-year IRS (in­ter­est rate swap) rate” said Caga­mas CEO Chung Chee Leong in a state­ment.

“The is­suance dis­plays an in­crease in ac­cep­tance of lo­cal cur­rency cor­po­rate bonds and sukuk among for­eign in­vestors, which is ev­i­denced by the year-on-year growth in for­eign hold­ings of Caga­mas ring­git bonds from 0.6% to 7.8% as at Septem­ber 2016,” added Chung.

Year-to-date, Caga­mas has suc­cess­fully is­sued a to­tal of RM6.3 bil­lion in the pri­mary mar­ket con­sist­ing of RM4.9 bil­lion in do­mes­tic cur­rency and RM1.4 bil­lion ring­git equiv­a­lent in for­eign cur­ren­cies. The com­pany has also achieved sec­ondary trad­ing vol­ume of RM13 bil­lion, mak­ing it the high­est traded cor­po­rate bond and sukuk in the lo­cal bond mar­ket thus far – and sec­ond to gov­ern­ment se­cu­ri­ties.

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