The TR BPAM All Bond Index posted a meagre gain of 0.08 per cent to 131.43 from 131.33 recorded last week. The gain was attributed to the lower yields of the benchmark GII where five-year GII and seven-year GII shed one and three basis points (bps) respectively over the week. Meanwhile, bond trading activities in the ringgit bond market was light as market players stayed on the sidelines ahead of the 2014 auction calendar announcement by Bank Negara Malaysia.
On the global front, the US Federal Reserve is going to unwind its historical quantitative easing programmeby trimming US$10 billion off its monthly asset purchase program to US$75 billion from US$85 billion starting from January 2014. Post-announcement, US Treasuries weaken along the belly of the yield curve with yields rising six bps to nine bps for tenures between three-year and 10-year US Treasuries. Trading activities slowed down as total trade volume of the top 10 most active bonds decreased by 24.5 per cent to RM6.01 billion compared to RM7.97 billion last week. The three-year benchmark MGS topped the list with RM903 million worth of bonds changed hands.
On December 17, 2013, Malakoff Power Bhd issued 17 tranches of Islamic Medium Term Note (IMTN) with tenures ranging between one-year and 18-years and profit rates between 4.1 per cent and 6.25 per cent. The total issuance size was RM5.38 billion and the notes is rated AA-IS by MARC with a stable outlook.
On December 18, 2013, there were new issuances by Telekom Malaysia Bhd (Telekom) and Riverson Corporation Sdn Bhd (Riverson Corporation). Telekom issued a RM200 million seven-year IMTN with profit rate of 4.3 per cent. The IMTN is rated AAA with a stable outlook by RAM Ratings. On the other hand, Riverson Corporation issued a RM50 million two-year bond with coupon rate of 3.80 per cent. The bond is guaranteed by Danajamin Nasional Bhd (Danajamin) and is rated AAA(fg) by MARC.
On December 20, 2013, Cagamas Bhd, Konsortium ProHAWK Sdn Bhd and Imtiaz Sukuk II Bhd (Imtiaz II) all came forth to issue IMTNs. Cagamas issued a one, three, five, seven and 10-year IMTN with profit rates ranging between 3.4 and 4.60 per cent. The IMTNs have a total issuance size of RM80 million and are rated AAA by both RAM Ratings and MARC.
Konsortium ProHAWK issued RM120 million worth of IMTNs with tenures of 15, 16, 16.5 and 17.5-year and profit rates of 5.21, 5.27, 5.29 and 5.34 per cent respectively. The IMTNs are rated AA2 by RAM Ratings.
Imtiaz II, a trust-owned entity set up as a funding conduit of Bank Kerjasama Rakyat Malaysia Bhd, issued two tranches of IMTN with a total issuance size of RM500 million. The IMTNs bears profit rate of 4.3 and 4.45 per cent for the three-year tranche and five-year tranche respectively. The issuance is rated AA2 by RAM Ratings.