The ringgit bond market saw a quiet week due to the lack of fresh catalyst.
MGS yields ended the week a tad higher by 1bps for tenures below the 20-year region.
Despite that, the Thomson Reuters BPAM All Bond Index registered a gain of 0.086 per cent to close at 161.919 points.
On the international front, European Central Bank (ECB) had left its key interest rate unchanged and ended its 2.6 trillion euros bond-buying programme this month.
The ECB also mentioned that it would continue to reinvest cash from maturing bonds for an extended period of time beyond its next interest rate hike.
The total traded amount of the top 10 most active bonds shrunk by almost two-thirds to RM3.7 billion from RM9 billion last week.
The re-opened three-year benchmark GII maturing on March 31, 2022 was the most active bond in the list with total traded amount of RM874 million.
On December 11, BNM announced the details of the final auction for the year 2018.
The reopening of the three-year benchmark GII maturing on March 31, 2022 comes with an issuance size of RM3.3 billion and another RM500 million to be privately placed.
The tender closed on December 13, with a decent bid-to-cover ratio of 2.426 times.
The auction recorded the highest, average and lowest yields at 3.782, 3.775 and 3.765 per cent respectively.
On December 10, Silver Sparrow Bhd issued one tranche of Danajamin guaranteed and one tranche of bank guaranteed 1-year Medium Term Notes (MTN) with a combined issuance size of RM100 million.
The coupon rates for both tranches are set at 4.65 per cent.
The issues are rated AAA(FG) and AAA(BG) respectively with stable outlook by RAM Ratings.
On December 12, Gas Malaysia Bhd issued two tranches of Islamic Medium Term Notes (IMTN) amounted to RM51 million.
The issued tenures are three-year and five-year with profit rates of 4.36 and 4.56 per cent respectively.
The IMTNs are rated AAA IS with stable outlook by MARC.
On December 14, Cagamas Bhd issued a one-year floating rate note amounted to RM150 million, of which the floating coupon rate is determined based on a 15bps spread on the three-month Kuala Lumpur Interbank Offered Rate (KLIBOR).
The MTN is rated AAA by RAM Ratings and AAA by MARC with stable outlook respectively.
The coupon rate for the next three months is 3.84 per cent.
On December 14, RAM Ratings had downgraded the rating of Jati Cakerawala Sdn Bhd’s RM540 million Sukuk Murabahah to A1 from AA3.
The downgrade is premised on the expected deterioration in Jati’s subordinated finance service coverage ratio (Sub-FSCR), following its intention of maximising dividend payments, so long as this is permitted by the transaction’s distribution covenant.
The Sub-FSCR of 1.40 times reflects an adequate capacity vis-à-vis meeting Jati’s financial obligations.