TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Malaysia issues $800 million sustainability sukuk, world's first by a sovereign
In addition, the Southeast Asian nation also issued $500 million 30-year trust certificates, the ministry said in a statement, quoted by Reuters.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
The government tapped into the global sukuk market as it recently issued US$ 750 billion with 5.5 years maturity period and a 10-years tenor of $1.52 billion global sukuks, respectively. (Shutterstock/File)
M
alaysia has issued $800 million 10-year trust certificates, world's first sovereign US dollar sustainability sukuk, the finance ministry said on Thursday.
In addition, the country also issued $500 million 30-year trust certificates, the ministry said in a statement, quoted by Reuters.
Malaysia upsized the sukuk offering from initial target size of $1.0 billion to $1.3 billion due to overwhelming demand as oversubscription hit 6.4 times.
Sustainable debt issuance rose 29 percent last year to a record $732 billion, according to figures from BloombergNEF. Indonesia sold green debt that complies with religious principles in 2018, making it the first country in the world to issue such securities, according to a United Nations Development Programme report.
“Demand for ESG or sustainability-linked bonds continues to gain traction while there is still a limited supply” of such issuance from Southeast Asia, said Winson Phoon, head of fixed-income research at Maybank Kim Eng Securities in Singapore, quoted by Bloomberg. “Adding the sustainability label helps widen further the investor base.”
Malaysia is also an infrequent issuer in overseas bond markets, last selling dollar debt in 2016. The sovereign’s existing US currency notes have longer duration than Asian credit more broadly, which made them vulnerable to a selloff last quarter as yields spiked. They’ve since recouped some losses as interest rates retreated.
