Thursday 28 Mar 2024
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KUALA LUMPUR (Jan 26): Bank Negara Malaysia (BNM) said it may purchase up to 10% of the Malaysian government’s proposed RM3 billion Islamic bonds in the form of Government Investment Issues (GII), which will be issued on Monday (Jan 31, 2022) under the Murabahah principle pursuant to the Government Funding Act 1983.

In a filing with BNM’s Fully Automated System for Issuing/Tendering (FAST) website, the central bank, which is the facility agent for the RM3 billion Islamic bond issuance, said the securities, which pay an annual profit rate of 3.447%, will be issued on Monday (Jan 31, 2022) for maturity on July 15, 2036.

"BNM may purchase up to 10% of the issuance size,” BNM said.

According to BNM, the RM3 billion Islamic bond scheme is opened for bidding by bidders on Wednesday while the closing date for the bidding exercise is on Friday at 11:30am.

In the RM3 billion Islamic bond scheme’s prospectus, BNM said the securities' original issue date was Jan 15, 2021 and that application by bidders should be submitted through 19 dealers comprising conventional principal dealers and Islamic principal dealers.

The conventional principal dealers include AmBank Bhd, CIMB Bank Bhd and United Overseas Bank (M) Bhd while the Islamic principal dealers include Affin Islamic Bank Bhd, Bank Islam Malaysia Bhd and Maybank Islamic Bank Bhd.

"Principal dealers and Islamic principal dealers are hereby invited to tender for the re-opening of Malaysian GII No. 1 of 2021.

"The investments for Series 1 of 2021 will be redeemed at par on July 15, 2036. On the maturity date of the investment, BNM shall credit the current account of each participating investing institution/depository institution with the principal monies represented by the investments standing in its own securities account and/or aggregate customers' account.

"Profit is payable half-yearly on Jan 15 and July 15 and the first such payment on the additional issues will be made on July 15, 2022, calculated from Jan 15, 2022 at the profit rate of 3.447%. Profit on the principal monies shall cease after the maturity date of this stock,” BNM said.

It said application for the securities must be in multiples of RM1 million with a minimum value of RM5 million.

According to BNM, transfers of the securities to successful bidders are exempted from payment of stamp duty.

"BNM reserves the rights to accept or reject any application without assigning any reason therefore. Where an application is accepted in part only, no allotments will be made for stock of less than RM10,000.

"Payment for the amounts accepted and allotted must be made in full on the issue date. For this purpose, applicants shall authorise BNM to debit their respective current accounts maintained with BNM for the cost of the investments allocated. Prices, based on the successful yield bids, shall be expressed to three decimal places on allocation,” BNM said.

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