Refinancing fuels record sukuk, firms take advantage of low yields to raise RM91b from bonds

KUALA LUMPUR: Malaysian companies are taking advantage of all-time low yields to refinance local-currency sukuk, accounting for 55% of 2012's record issuance.

Average costs for 15-year top-rated corporate debt fell 48 basis points this year to 4.6%, according to a Bank Negara index. Of the RM91bil of syariah-compliant securities issued in 2012, RM50bil was for refinancing, data compiled by Bloomberg show. Sime Darby Bhd, the world's biggest palm-oil producer, sold RM700mil of Islamic bonds on Nov 28 as part of a restructuring, pricing the portion due in 2027 at 4.35%.