Cagamas successfully prices RM150m debt papers

  • Corporate News
  • Monday, 22 Jun 2020

Cagamas president and CEO, Datuk Chung Chee Leong said on Monday the CCPs were competitively priced.

KUALA LUMPUR: Cagamas Bhd has successfully priced its RM150mil three-month conventional commercial papers (CCPs) which would be used to fund the purchase of housing loans from the financial system.

Cagamas president and CEO, Datuk Chung Chee Leong said on Monday the CCPs were competitively priced at the corresponding three-month KLIBOR benchmark rate plus 3 bps or equivalent to 2.31% based on KLIBOR fixing on the pricing date.

“The pricing of the CCPs represented 28 bps above Malaysian Treasury Bills, which was concluded via private placement basis, ” he added.

Chung said the successful pricing of the CCPs reflected investors’ continued strong demand for the company’s short term debt securities.

This was despite global financial markets bracing for uncertainty due to economic reopening, coupled with the increasing geopolitical tension, which affected investor sentiment locally, he added.

The RM150mil issuance was Cagamas’ seventh issuance exercise for the year and brings the year-to-date (YTD) issuance amount to RM3.46bil.

The papers, which will be redeemed at their full nominal value upon maturity, are unsecured obligations of the company, ranking pari passu 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 was established in 1986 to promote the broader spread of home ownership and growth of the secondary mortgage market in Malaysia.

It issues corporate bonds and sukuk 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.

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