Cagamas Berhad (“Cagamas” or “the Company”), the National Mortgage Corporation of Malaysia, is pleased to announce the successful execution of the country's first Malaysia Islamic Overnight Rate (MYOR-i) referenced Islamic Medium Term Notes (“Sukuk”) and Islamic Profit Rate Swap (“IPRS”) transactions, comprising a MYR300 million ($73.6 million) 1-year MYOR-i Sukuk and a MYR100 million ($24.5 million) 5-year MYOR-i IPRS.

MYOR-i, the first transaction-based Islamic benchmark rate in the world, is developed in accordance with the Principles for Financial Benchmarks. These landmark transactions represent Malaysia's and Cagamas' first ever Sukuk to be priced against the MYOR-i, together with the IPRS which serves as a hedging tool in the transactions. These transactions reinforce Cagamas' continued commitment to funding innovation and support the development of alternative reference rate-based instruments in Malaysia's debt capital market as well as derivatives market.

Kameel Abdul Halim, president/chief executive officer of Cagamas, said: “The successful conclusion of the transactions reflects Cagamas' role in supporting Bank Negara Malaysia's initiative towards a more transaction-based rate setting framework and advancing innovation in the domestic Sukuk market. The transactions also demonstrate Cagamas' readiness to operate in an evolving alternative reference rate environment while continuing to deliver innovative Shariah-compliant market solutions.

“We are encouraged by the strong support received from our banking partners, which reflects their continued confidence in Cagamas' credit strength and strategic role within Malaysia's financial ecosystem,” he added.

The MYR300 million ($73.6 million) 1-year MYOR-i Sukuk was jointly led by AmInvestment Bank Berhad and CIMB Investment Bank Berhad as lead managers, while the MYR100 million ($24.5 million) 5-year MYOR-i Islamic Profit Rate Swap (IPRS) was transacted with CIMB Islamic Bank Berhad.

The proceeds from the issuances will be utilised to finance Cagamas' purchase of eligible financing assets from financial institutions, in line with the Company's mandate to promote liquidity and enhance financing availability within Malaysia's housing and financial sectors. These initiatives further demonstrate its ability to adapt to evolving market benchmarks while establishing an important reference point for future MYOR-i-linked issuances and supporting the broader adoption of alternative reference rate-based structures.

Re-disseminated by The Asian Banker