Malaysia Bond and Sukuk: Quarterly Report 4Q2022

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Malaysia Bond and Sukuk: Quarterly Report 4Q2022

4Q2022 – Robust Bond Market Activity in Malaysia: A Recap of 2022

In Malaysia, local government bonds saw gains due to the reopening of China and declining inflationary pressure. The sale of a 3-year government bond attracted strong demand. The corporate bond market in Malaysia saw a record high in issuances, with yields falling for all maturities. Foreign holdings of local bonds saw a decrease in net selling, with outflows slowing down compared to previous quarter.


3-year yield for the US Treasury slightly decrease 3 bps q-o-q while the yield on the benchmark 10-year Treasury note shows a slightly increase on 5 bps q-o-q. UST ended weaker for the quarter due to the back of 125 bps raised of Fed rate in November and December 2022.

MY Government Bond

The MGS yield decreased q-o-q, where the 3-year was down by 10 bps and the 10-year declined by 34 bps. As for GII performance, the q-o-q decrease across the curve by 4 bps for 3-year and 29 bps for 10-year. Yields declined as investors’ confidence in the new government’s ability to maneuver both fiscal and monetary policies.

MY Corporate Bond & Sukuk

The corporate bond yields decrease (q-o-q) throughout the fourth quarter of 2022. The yields down 13 bps for 3-year and 27 bps for 10-year.
4Q22 Market Overview


The government bond auction for 4Q22 garnered an average BTC of 2.097x, a slightly decrease from the previous quarter (3Q22: 2.342x). A reopening of MGII 10/25 received the highest BTC at 4.205x. The new/reopening issuances for MGS/GII stood at RM 32.0 billion (3Q22: RM35.5 billion). 

As of December 2022, the outstanding amount of MGS/GII was at RM979.48 billion (3Q22: RM979.48). Strong secondary market activities were still led and supported mostly by local institutions that included pension funds, interbank participants, and local GLICs.

In total, there were eight (8) reopening of MGS and GII auctions in 4Q22.

4Q22 Government Bond Auction
Source BNM, BIX Malaysia
For the upcoming 1Q23, there will be four (4) reopening and one (1) new issue of MGS. For GII there will be two (2) new issue and three (3) reopening, totalling to ten (10) new issue and reopening.   

4Q22 Government Bond Upcoming Issuance
Source BNM, BPAM, BIX Malaysia


The foreign net flow to MGS and GII in 4Q22 amounted to -RM3.95 billion, RM1.22 billion and RM2.71 billion respectively in October, November and December as foreign investors turn net seller. As of December 2022, the total foreign holdings of MGS and GII stood at RM226.18 billion (September 2022: RM226.20 billion), -0.01% decrease from the previous quarter. 

4Q22 Foreign Holdings of MGS and GII
Source BNM

4Q22 Cumulative  Net Foreign Flow to MGS and GII
Source BNM

RM52.16 billion corporate bonds and sukuk were issued in 4Q21 (3Q22: RM32.56 billion), 60.2% increase from the previous quarter. The AAA rated bonds and sukuk were the most issued with RM20.80 billion issuances, followed by AA1/AA+ bonds at RM7.85 billion issuances.

For 4Q22, the largest corporate issuances were issued by United Overseas Bank (Malaysia) Berhad, UOBM MTN 3653D 27.10.2032 of RM1.00 billion.

4Q22 Corporate Bond Issuance
Source BNM, BIX Malaysia

There was no default and downgrade recorded in 4Q22. However, there are four (4) upgraded bonds/sukuk in this quarter.

  1.  Press Metal Aluminium Holdings Berhad
  2. Northport (Malaysia) Bhd
  3. SEP Resources (M) Sdn Bhd
  4. Zamarad Assets Berhad & Al Dzahab Assets Berhad

4Q22 Rating Movements
Source: MARC, RAM and BIX Malaysia


Outstanding Amount by Bond Classes

As of December 2022, the outstanding amount of the Malaysian bond market stood at RM1.87 trillion, increased by 0.54% compared to the end of 3Q22 (September 2022: RM1.86 trillion). The largest outstanding bonds were from government issuances which consist of 56.2% of total issuances at RM1,051.08 billion, followed by corporate issuances of 25.5% at RM477.53 billion, and Quasi-government of 18.3% at RM342.47 billion.

4Q22 Outstanding Amount by Bond Class

Outstanding Amount by Principal and Bond Classes
As of December 2022, the outstanding amount of the Government conventional bond and the Government Islamic Bond (Sukuk) stood at RM548.18 billion and RM502.90 billion, respectively. The conventional Quasi-govt outstanding amount stood at RM21.07 billion, only a fraction compared to its Islamic counterpart that stood at RM321.40 billion. For corporate issuances, the conventional bond outstanding amounted RM118.06 billion while the corporate Sukuk was recorded higher at RM359.47 billion.

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.