Sukuk

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Sukuk

Cagamas issues Sukuk via its existing RM20 billion Islamic/Conventional Commercial Papers (ICPs/CCPs), and RM60 billion Islamic/Conventional Medium Term Notes (IMTNs/CMTNs) programmes and via its subsidiary, Cagamas Global Sukuk Berhad issues Sukuk under the USD2.5 billion Multicurrency Sukuk Issuance Programme (“Multicurrency Sukuk”) to facilitate Islamic foreign currency funding programme.

The instruments issued under the programmes as follows:

  1. Fixed Profit Rate Islamic Medium-Term Notes (IMTNs)
    IMTNs are Ringgit denominated Sukuk with fixed profit rate with tenures of more than one year and are issued either at a premium, par or at a discount, with or without a profit rate. Profit distribution of the IMTNs are normally made on half-yearly. The redemption of the relevant IMTNs are at nominal value together with the profit due upon maturity.

    Apart from Ringgit IMTNs, Cagamas also issued IMTNs in foreign currency (Sukuk EMTNs). Under the USD2.5 billion Multicurrency Sukuk Issuance Programme, Cagamas Global Sukuk Berhad, may from time to time issue Sukuk EMTN in any currency (other than Ringgit Malaysia) which Cagamas is the obligor under the Sukuk Programme.  
     
  2. Variable Profit Rate Notes (VRNs)
    VRNs are Ringgit denominated IMTNs with tenures of more than one year with variable profit rate pegged to a reference rate, e.g. Kuala Lumpur Interbank Offered Rate (KLIBOR). Profit distributions of the VRNs are normally made on quarterly or half-yearly basis. At maturity, the face value of the relevant VRNs are redeemed with any outstanding profit amounts due on maturity.

    Apart from Ringgit VRNs, Cagamas also issued VRNs in foreign currency (VRN Sukuk EMTNs). Under the USD2.5 billion Multicurrency Sukuk Issuance Programme, Cagamas Global Sukuk Berhad, may from time to time issue VRN Sukuk EMTN in any currency (other than Ringgit Malaysia) which Cagamas is the obligor under the Sukuk Programme.  
     
  3. Islamic Commercial Papers (ICPs)
    ICPs are Ringgit denominated short term Islamic instruments with maturities ranging from one to twelve months, issued with or without profit paid, at either a discount from the face value where the relevant ICPs are redeemable at their nominal value upon maturity or at par with profit is paid on a semi-annual basis or on such other periodic basis as determined by Cagamas.

    Cagamas may issue IMTNs and ICPs based on but not limited to the following Shariah principles:

    • Murabahah (via a Tawarruq arrangement)

    • Ijarah

    • Musharakah
    • Wakalah Bil Istithmar

    • Mudharabah

     

  4. Multicurrency Sukuk
    Under the Sukuk EMTNs , the sukuk is currently issued based on Shariah principle of Wakalah. The Sukuk EMTNs issuance is on a fully-paid basis and at a par issue price and the method of calculating the profit rate may vary between the issue date and the maturity date of the relevant series of Sukuk EMTNs issued.

Sukuk Wakalah Bil Istithmar

Sukuk Wakalah Bil Istithmar is a type of fixed income agency investment sukuk.

Its investment portfolio consists of debts (commodity trading) and Sharian-compliant tangible asstes which comprise either asset based financing contracts or sukuk based on ijarah or wakalah bil Istithmar principles or equity asset based on mudharabah principle at 70:30 ratio.

Sukuk Murabahah/Commodity Murabahah

Sukuk Murabaha is a deferred payment sukuk that is structured on cost plus basis.

The sukuk proceeds is used by the SPV as capital to purchase an asset and sell it to the obligator on a cost-plus-profit-margin basis.

Where permitted by the respective trust deeds, Cagamas may at any time purchase its debts securities and the repurchased debt securities shall be cancelled according to the requirements of the trust deeds and FRS139.

Outstanding Cagamas Sukuk as at 31 August 2020
Instrument Foreign Currency (mil) Malaysian Ringgit (mil)
Islamic Medium Term Notes (IMTNs)   14,575
Variable Rate Notes (VRN)   -
Islamic Commercial Paper (ICPs)   605
Fixed Rate FCY Sukuk (EMTNs)   -
     
Total   15,810