KUALA LUMPUR: Malaysia’s debt securities remained the largest in Southeast Asia last year, at 104.4% of gross domestic product (GDP), said Bank Negara Malaysia (BNM).

In its Annual Report 2014, the central bank said total outstanding debt securities grew 8.2% to RM1,117.0 billion in 2014, from RM1,032.5 billion in the previous year.

The nominal value of new issuances amounted to RM505.9 billion in 2014, compared with RM501.2 billion in 2013.

BNM highlighted Cagamas Bhd’s issuance of a three-year RMB1.5 billion bond in September 2014, attracting a strong order with a bid-to-cover ratio of over three times and a fixed coupon rate of 3.7% per annum.

“The landmark issuance, which carries the market name ‘Tiger Emas Bond’, represents the largest renminbi bond by a Malaysian issuer during the year,” it said, adding that the issuance was the first to be settled via Malaysia’s Real-time Electronic Transfer of Funds and Securities System (Rentas).

Robust growth was also seen in the foreign exchange market in 2014, with the average daily turnover of foreign exchange transactions increasing 13.5% year-on-year (y-o-y) to US$11.8 billion, from US$10.4 billion.

In a bid to modernise the financial market infrastructure, BNM granted approval to a foreign electronic money-broker to provide an electronic matching platform for the interbank foreign exchange market.

“The introduction of a foreign electronic money-broker forms part of Malaysia’s ongoing liberalisation of the foreign exchange market and is expected to accelerate the development of electronic channels that will extend efficiency gains and opportunities beyond the interbank market to other intermediaries and end-users,” said BNM.

In line with the increase in intra-regional trade, 2014 also saw the operationalisation of a Renminbi Deposit and Investment Facility (RDIF) and the appointment of a designated renminbi clearing bank.

BNM noted that onshore financial institutions have placed a total of RMB3.5 billion through RIDF during the year.

This article first appeared in The Edge Financial Daily, on March 12, 2015.