Kuala Lumpur: Cagamas Berhad, the National Mortgage Corporation, announced the successful RM230 million issuance of its award winning variable rate Sukuk Commodity Murabahah along with RM180 million floating rate Conventional Medium Term Notes (CMTNs).
According to the announcement, the variable rate Sukuk and floating rate CMTNs will be issued via its existing RM60 billion Islamic Commercial Paper and Medium Term Notes Program in tenures of 3 years.
“The Sukuk represented the largest ever rated, transferrable and tradable variable rate Commodity Murabahah note issuance by a corporate in the Ringgit market on its debut in 2010. It remains the largest rated variable rate Sukuk outstanding in the domestic market,” said Chung Chee Leong, President/CEO of Cagamas.
He added that both Islamic and conventional issues received strong investor demand with an oversubscription rate of 1.6 times amidst a challenging bond market environment.
The Cagamas IMTNs and CMTNs, which will be redeemed at their full nominal value on maturity, are unsecured obligations of the Company, ranking paripassu among themselves and with all other existing unsecured obligations of the Company. They will be listed and tradable under the Scripless Securities Trading System.
Cagamas Berhad (Cagamas), the National Mortgage Corporation, was established in 1986 to promote the broader spread of house ownership and growth of the secondary mortgage market in Malaysia. It issues debt securities to finance the purchase of housing loans from financial institutions and non-financial institutions. The provision of liquidity to financial institutions at a reasonable cost to the primary lenders of housing loans encourages further expansion of financing for houses at an affordable cost.
The Cagamas model is well regarded by the World Bank as the most successful secondary mortgage liquidity facility. Cagamas is the second largest issuer of debt instruments after the Government of Malaysia and the largest issuer of AAA debt securities in the market. Since incorporation in 1986, Cagamas has cumulatively issued RM267.8 billion of conventional and Sukuk.
Cagamas’ debt securities continue to be assigned the highest ratings of AAA and P1 by RAM Rating Services Berhad and AAA/AAAID and MARC-1/MARC-1ID by Malaysian Rating Corporation Berhad, denoting its strong credit quality.