Borneo Post Online - BPA Malaysia weekly bond market report 19 November 2017

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Over the week, the Thomson Reuters BPAM All Bond Index emerged from the red with a gain of 0.092 per cent to close at 154.53 points from 154.388 points recorded last week.

Similarly, the MGS had also pared back losses from previous week with the yields eased by one to eight bps across the board except for the two-year, three-year and 15-year tenure points.

Meanwhile, ringgit strengthened further against the US dollar to 4.164 from 4.191 last Friday, partially due to hawkish tone in the last week’s MPC statement and weaker US dollar as a result of the uncertainty over the Trump’s tax bill.

On November 17, 2017, Bank Negara Malaysia reported that Malaysia’s economy expanded at a faster pace compared to a year ago.

Malaysia’s GDP recorded a 6.2 per cent growth rate in the third quarter of 2017 as compared to 4.3 per cent growth registered in the same quarter last year.

The growth is underpinned by robust private sector spending coupled with strong exports.

Top 10 most active bonds:

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Trading activities in the ringgit bond market remained muted ahead of the release of Malaysia’s third quarter GDP data.

Thus, the trade volume of the top 10 most active bonds declined RM8.9 billion from RM10.3 billion last week.

For the second consecutive week, the short term MGS maturing on March 1, 2018 topped the list with RM 2.8 billion changed hands.

Sovereign auction(s):

On November 10, 2017, Bank Negara Malaysia announced the tender details for the re-opening of the RM3 billion 10-year benchmark GII maturing on July 26, 2027.

The tender closed on November 15, 2017 with a bid-to-cover ratio of 1.832 times.

The highest, average and lowest yield came in at 4.37, 4.347 and 4.3 per cent respectively.

New issuance(s):

On November 13, 2017, Bank Islam Malaysia Bhd issued a RM300 million 10-year subordinated Sukuk Murabahah with a non-call period of five years.

The sukuk bears profit rate of 5.080 per cent and is rated A1 with stable outlook by RAM Ratings.

On November 16, 2017, Maybank Islamic Bhd issued a one-year discount Islamic Medium Term Notes (IMTN) worth RM250 million.

The IMTN is rated AAA with stable outlook by RAM Ratings.

DanaInfra Nasional Bhd issued five tranches of government guaranteed IMTN amounted to RM3 billion with tenures ranging from seven to 30 years.

The IMTNs carry profit rates between 4.33 and 5.35 per cent.

On November 17, 2017, Alpha Circle Sdn Bhd issued one tranche of sukuk with issuance amount of RM55 million that bears five per cent profit rate.

The one-year sukuk is rated AA-IS with stable outlook by MARC.