KUALA LUMPUR, April 17 (Bernama) -- The success of Malaysia's US$1.5 billion sukuk issuance on Wednesday not only boosted investor sentiment but also reflects the country's position as the world's leading Islamic financial hub.
Affin Hwang Investment Bank Vice-President/Head of Retail Research Datuk Dr Nazri Khan Adam Khan said the bond was sold at a very reasonable rate and was well absorbed by global investors after the last issuance in 2011.
"Despite the 1MDB (1Malaysia Development Bhd) concerns, weakening ringgit and other uncertainties, we were still able to sell the sukuk with a very good yield," he told Bernama today.
The fact that the sukuk was able to attract global investors, particularly from the Middle East has suggested that the government's economic fundamentals remained healthy despite the ringgit trading at around 3.65 against the greenback.
On a possible downgrade, Nazri said it was not a consensus among the three main rating agencies, namely, Moody's Investors Service, S&P Ratings and Fitch Ratings.
Despite saying that Fitch was entitled to its own opinion on a possible downgrade, Nazri hoped it would not materialise as palm oil offtake were improving, the ringgit was strengthening and the government's tax restructuring plan was expected to boost the export sector.
The success of Malaysia's sukuk issuance, after a lapse of almost four years, has drawn positive response from international investors who have reaffirmed their confidence in the country's long-term economic fundamentals.
(Bernama.Com / 17 April 2015)
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com