KUALA LUMPUR: Cagamas Bhd has successfully executed Malaysia’s first Malaysia Islamic Overnight Rate (MYOR-i)-referenced Islamic Medium Term Notes (sukuk) and Islamic Profit Rate Swap (IPRS) transactions, comprising a RM300 million one-year MYOR-i sukuk and a RM100 million five-year MYOR-i IPRS.
In a statement today, Cagamas said MYOR-i, the world’s first transaction-based Islamic benchmark rate, was developed in accordance with the principles for financial benchmarks.
It said the landmark transactions marked Malaysia’s and Cagamas’ first-ever sukuk issuances priced against MYOR-i, with the IPRS serving as a hedging instrument for the transactions.
"These transactions reinforce Cagamas’ continued commitment to funding innovation and support the development of alternative reference rate-based instruments in Malaysia’s debt capital and derivatives markets.
"The proceeds from the issuances will be utilised to finance Cagamas’ purchase of eligible financing assets from financial institutions, in line with the company’s mandate to promote liquidity and enhance financing availability within Malaysia’s housing and financial sectors,” it added.
Cagamas president and chief executive officer Kameel Abdul Halim said the successful completion of the transactions reflected Cagamas’ role in supporting Bank Negara Malaysia’s initiative towards a more transaction-based rate-setting framework and advancing innovation in the domestic sukuk market.
"The transactions also demonstrate Cagamas’ readiness to operate in an evolving alternative reference rate environment while continuing to deliver innovative Shariah-compliant market solutions.
"We are encouraged by the strong support received from our banking partners, which reflects their continued confidence in Cagamas’ credit strength and strategic role within Malaysia’s financial ecosystem,” he added.
The national mortgage corporation said the RM300 million one-year MYOR-i sukuk was jointly led by AmInvestment Bank Bhd and CIMB Investment Bank Bhd as lead managers, while the RM100 million five-year MYOR-i IPRS was transacted with CIMB Islamic Bank Bhd. - Bernama
