Malaysia bond market weekly update (10 Sept 2017)

The Index rose 0.303 per cent to end the week at 155.058 points from 154.590 points last week. The entire MGS yield curve dropped 2bps to 10bps except the 30-year region, which went up by 1bp.

The bullish sentiment was supported by foreign buying as the Malaysian ringgit also strengthened to 4.1960 against the greenback from 4.2705 in the previous week.

On 6 September 2017, ’s exports in July rose 30.9 per cent to RM78.6 billion while the imports increased by 21.8 per cent to RM70.6 billion on a yearly basis. The trade surplus registered at approximately RM8 billion.

On September 7, 2017, decided to maintain the benchmark Overnight Policy Rate (OPR) at three per cent citing higher domestic growth prospect due to stronger spillovers from the external sector.

is also projected to moderate on expectations of a smaller effect from global cost factors.

The total trade volume of the top 10 most active bonds spiked to RM13.9 billion from RM7.7 billion as trading and market appetite improved on the back of rosy economic outlook.

The seven-year benchmark MGS maturing on September 30, 2024 topped the list with a turnover of RM2.4 billion.

On September 4, 2017, Telekom Malaysia Bhd issued a 10-year Islamic Medium Term Notes (IMTN) worth RM500 million with a profit rate of 4.58 per cent. The IMTN is rated AAA with stable outlook by RAM Ratings.

On September 5, 2017, Sabah Development Bank Bhd issued a 3-year Medium Term Notes (MTN) amounted to RM155 million. The MTN carries a coupon rate of 5.15 per cent and is rated AA1 with stable outlook by RAM Ratings.

On September 8, 2017, Danga Capital Bhd issued a RM1.5 billion 10-year IMTN with a profit rate of 4.52 per cent. The IMTN is rated AAA(S) with stable outlook by RAM Ratings.

On September 7, 2017, Lembaga Pembiayaan Perumahan Sektor Awam (LPPSA) issued five tranches of IMTN with tenures ranging from 3 years to 30 years.

The total issuance size is RM3.5 billion and the profit rates are from 3.95 per cent to 5.26 per cent. The IMTNs are guaranteed by Government of Malaysia and thus exempted from rating.

On September 5, 2017, RAM Ratings has downgraded the rating of Bahrain Mumtalakat Holding Company BSC’s (Mumtalakat or the Company) RM3 billion Murabahah Programme (2012/2032) to A3/Stable from A1/Negative subsequent to the downgrade of Bahrain’s sovereign rating to A3(pi)/Stable from A1(pi)/Negative. Mumtalakat’s issue rating is equated with Bahrain’s rating as the Company is viewed by RAM Ratings as an extension of the government, based on its critical linkage to the latter, its strategic economic role and the government’s solid support for the Company.

Source: Borneo Post Online

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