Cagamas, the National Mortgage Corporation of Malaysia, issued its inaugural ASEAN sustainability SRI Sukuk worth RM100 million (US$22.21 million) on the 26th October 2020. Issued under the company’s existing RM60 billion (US$13.32 billion) Islamic medium-term note (IMTN) program, the Sukuk facility was priced in conjunction with an IMTN worth RM350 million (US$77.74 million).
The issuance was conducted through a public bookbuilding exercise which was led by RHB Investment Bank. The proceeds from the Sukuk will fund the purchase of eligible Islamic financing for affordable housing.
The bookbuilding exercise received an overwhelming response from investors, achieving a total order of nearly RM2 billion (US$444.03 million) at the initial price guidance. The Sukuk and IMTN received a final book-to-cover ratio of 3.3 times with a final price of 2.23% per annum and 2.25% per annum for the Sukuk and IMTN respectively. The final prices for the issuance represented 39bps and 41bps respectively above the corresponding three-year Malaysian Government Investment Issue.
“The positive conclusion of this issuance is a strong testament of Cagamas’s commitment to support the development of industry-led sustainable product offerings such as affordable housing loans and financings. It is indeed a meaningful milestone for Cagamas amidst current challenging market conditions,” Chung Chee Leong, the president and CEO of Cagamas, remarked.
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Cagamas inaugural ASEAN Sustainability SRI Sukuk RM100 million (US$22.21 million)  26th October 2020 |
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| Summary of terms and conditions | |
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Issuer |
Cagamas |
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Size of issue |
RM100 million (US$22.21 million) |
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Mode of issue |
Public bookbuilding |
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Purpose |
To fund the purchase of eligible Islamic financing for affordable housing |
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Tenor |
Three years |
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Profit Rate |
2.23% |
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Currency |
Malaysian ringgit |
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Maturity date |
26th October 2023 |
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Lead arranger (s) |
RHB Investment Bank |
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Islamic structure |
Murabahah |
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Rating |
‘AAA/Stable’ by RAM Ratings; ‘AAAIS’ by Malaysian Rating Corporation |
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Tradability |
Yes |