Malaysia Bond and Sukuk: Quarterly Report 2Q2024

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BIX Malaysia - Quarterly Report 2Q 2024

2Q2024 – MGS/GII remain top issuer in 2Q2024 and top performing in ASEAN market.

MGS/GII remained as top issuer in 2Q2024 and the top performing in 1H2024 from ASEAN Index with a YTD return of 1.91% as demand for the papers were bolstered by robust domestic demand, fiscal reform progress, and a stable ringgit1. Malaysia remain the largest sukuk market globally, with around 60 per cent of its ringgit Debt Capital Markets (DCM) and Saudi Arabia, UAE and Malaysia will likely stay among the most active sukuk issuers2


3-year yield for the US Treasury yields increased by 12 bps q-o-q. The yield on the benchmark 10-year Treasury notes has also gone up by 16 bps q-o-q. U.S. Treasury yields spike as U.S. deficit and inflation come into focus where traders also weighed the fiscal outlook. One concern is that bigger federal deficits will likely be on the way regardless of which candidate wins in election.

MY Government Bond

The MGS yields experienced a quarterly increase, with the 3-year up by 2 basis points and the 10-year seeing a 1 basis points rise. The GII saw an increased performance by 1 basis points for the 3-year and by 2 basis points for the 10-year. Malaysia's government bond supply may slow in the second half and be on track to fall for the full year of 2024 amid smaller deficit financing requirements and strong investor demand.

MY Corporate Bond & Sukuk

The corporate bond and Sukuk yields saw improvement throughout the second quarter of 2024. The yields increased by 8 bps, 5 bps and 2 bps for 3-year and 5-year for 10-year while there is no change for yields in second quarter 2024 for 7-year.
2Q24 Market Overview

Reference: 1. RHB Fixed Income Report; 2. Fitch Ratings

The government bond auction for 2Q24 garnered an average BTC of 2.477x, a slight drop from the previous quarter (1Q24: 2.674x). A reopening of MGII 8/43 received the highest BTC at 3.475x. The new/reopening issuances for MGS/GII stood at RM39.5 billion (1Q24: RM42.0 billion). 

As of June 2024, the outstanding amount of MGS/GII was at RM1,177.66 billion (1Q24: RM1,162.16 billion). Domestic demand for Ringgit bonds remains resilient with long durations should continue to be underpinned by local pension funds and life insurance companies, supporting a stay of flat MGS curve at the back end

2Q24 Government Bond Auction
Source BNM and BIX Malaysia
For the upcoming 3Q24, there will be zero (0) new issue and five (5) reopening of MGS. For GII there will be five (5) reopening and zero (0) new issue, totalling to ten (10) reopening.

2Q24 Government Bond Upcoming Issuance
Source BNM and BIX Malaysia


The foreign net flow to MGS and GII in 2Q24 amounted to RM1.16 billion, RM4.36 billion and –RM1.14 billion respectively in April, May and June as foreign investors turn net buyer. As of June 2024, the total foreign holdings of MGS and GII stood at RM256.08 billion (March 2024: RM251.69 billion), 1.74% increase from the previous quarter. 

2Q24 Foreign Holdings of MGS and GII
Source BNM

2Q24 Cumulative  Net Foreign Flow to MGS and GII
Source BNM

RM42.41 billion corporate bonds and sukuk were issued in 2Q24 (1Q24: RM34.04 billion), 24.59 % increase from the previous quarter. The AA2/AA-rated bonds and sukuk were the most issued with RM13.79 billion issuances, followed by AAA-rated bonds at RM8.40 billion issuances.

For 2Q24, the largest corporate issuances were issued by PENGURUSAN AIR SPV BERHAD, PASB IMTN 4.070% 03.06.2039 - Issue No. 42 of RM1.08 billion.


2Q24 Corporate Bond Issuance

There was zero (0) default and zero (0) upgrades recorded in 2Q24. However, there is one (1) downgraded bonds/sukuk in this quarter.

⬇️ Downgrade
  1. YNH Property Berhad

2Q24 Rating Movements
Source: MARC, RAM and BIX Malaysia


Outstanding Amount by Bond Classes

As of June 2024, the outstanding amount of the Malaysian bond market stood at RM2.064 trillion, increased by 0.93% compared to the end of 1Q24 (March 2024: RM2.045 trillion). The largest outstanding bonds were from government issuances which consist of 58.14% of total issuances at RM1.20 trillion, followed by corporate issuances of 25.12% at RM518.57 billion, and Quasi-government of 16.74% at RM345.56 billion.

2Q24 Outstanding Amount by Bond Class
Source: BNM and BIX Malaysia

Outstanding Amount by Principal and Bond Classes
As of June 2024, the outstanding amount of the Government conventional bond and the Government Islamic Bond (Sukuk) stood at RM619.36 billion and RM580.80 billion, respectively. The conventional Quasi-govt outstanding amount stood at RM22.15 billion, much smaller compared to its Islamic counterpart that stood at RM323.41 billion. For corporate issuances, the conventional bond outstanding amounted RM115.08 billion while the corporate Sukuk was recorded higher at RM403.48 billion.

2Q24 Outstanding Amount by Principal and Bond Classes
Source: BNM and BIX Malaysia

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This report has been prepared and issued by Bond and Sukuk Information Platform Sdn Bhd (“the Company”). The information provided in this report is of a general nature and has been prepared for information purposes only. It is not intended to constitute research or as advice for any investor. The information in this report is not and should not be construed or considered as an offer, recommendation or solicitation for investments. Investors are advised to make their own independent evaluation of the information contained in this report, consider their own individual investment objectives, financial situation and particular needs and should seek appropriate personalized financial advice from a qualified professional to suit individual circumstances and risk profile.

The information contained in this report is prepared from data believed to be correct and reliable at the time of issuance of this report. While every effort is made to ensure the information is up-to-date and correct, the Company does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information contained in this report and accordingly, neither the Company nor any of its affiliates nor its related persons shall not be liable in any manner whatsoever for any consequences (including but not limited to any direct, indirect or consequential losses, loss of profits and damages) of any reliance thereon or usage thereof.