News Coverage
News Coverage
First retail bond, and more efforts to boost debt market
The Edge, 28 September 2012
KUALA LUMPUR (Sept 28): A few initiatives spelled out in the Budget 2013 are expected to encourage a more vibrant debt market.
This included the introduction of Malaysia’s first retail bond to be issued by DanaInfra Nasional Bhd.
The issuance of the retail bonds worth RM300 million by end-2012 to finance Mass Rapid Transport (MRT) development projects.
To further encourage companies to issue retail bonds and retail sukuk, the Government proposes that additional expenses incurred in the issuance of retail bonds and retail sukuk be given a double deduction for a period of four years effective from year of assessment 2012 to 2015.
Individual investors will also be given stamp duty exemption on instruments relating to the transactions of retail bonds and retail sukuk. The Securities Commission is currently formulating a framework for retail bond and sukuk issuances to enable investors to acquire stakes in the bond and sukuk markets.
Apart from that, the SC will also provide a framework for the issuance of AgroSukuk for companies engaged in the agriculture sector, following the successful listing of Felda Global Ventures Holdings Bhd.
To encourage the issuance of AgroSukuk, the government proposes that expenses for the issuance of AgroSukuk be given a double deduction for a period of four years effective from year of assessment 2012 to 2015.
Meanwhile, Danajamin has been allocated a further RM400 million for the next two years.
So far, Danajamin has approved guarantees totalling RM9.3 billion to 30 companies from various sectors including real estate, infrastructure, plantation, oil and gas, construction, manufacturing, and aviation.
This resulted in the issuance of bonds and sukuk worth RM4.2 billion.
The additional RM400 million fund is expected to multiply the issuance value between RM4 billion and RM6 billion.