Malaysian Rating Corporation Berhad (MARC) has assigned a short-term rating of MARC-1 to Cagamas Berhad’s RM200 million 1-year Cagamas (discount) Notes and long-term rating of AAA to Cagamas Berhad’s RM395 million 5-year fixed rate Cagamas Bonds issued on 12 September, 2002. The 1-year Notes and 5-year Bonds carry an average discount rate of 2.78% p.a. and an average coupon rate of 3.253% p.a. respectively. The new debt securities are issued to fund the purchase of mortgage loans from financial institutions, corporations and the Government, in addition to purchases of industrial property loans and hire purchase and leasing debts from the financial institutions. These new debt securities qualify as liquid assets for financial institutions, and are regarded as low risk assets for the purposes of s.46(2) of the Insurance Act 1996.

Cagamas’ rating is underpinned by its exceptionally strong ability to meet existing financial obligations and the distinctly superior quality of its portfolio of mortgages and Islamic house financing debts, purchased with full recourse to the primary lenders. Additional strengths include the company’s strict adherence to its exhaustive operational guidelines, prudent asset and liability management policies, strong earnings capacity and shareholder support.

The aforementioned debt securities issued on 12 September, 2002 rank pari passu among themselves and with all other existing unsecured obligations of the Company.