Friday, June 25, 2010

Bond market conditions to remain conducive in 2010, says Cagamas Holdings

KUALA LUMPUR: Cagamas Holdings Bhd expects investor interest to increase as bond market conditions are expected to remain conducive in 2010.

Its chairman Datuk Ooi Sang Kuang said this is in line with the recovery of the Malaysian economy and ample liquidity in the market.

He also said the group will continue to play a proactive role in ensuring that competitively priced liquidity is available in the capital market through innovative and high grade bond products.

"The group will play its part in strengthening and enhancing the Malaysian financial sector by actively promoting the industry's best practices and standards," Ooi said in his statement in the Cagamas Holdings Annual Report 2009.

Amongst the company's initiatives for the industry in 2010, he highlighted, is the establishment of a framework for conforming standards for mortgage loans.

The adoption of conforming loan features in a financial institutions lending practices will facilitate a more efficient pricing and purchase mechanism under the Purchase Without Recourse (PWOR) scheme.

"Internally, we are committed to strengthening our risk management, governance and oversight functions as well as continue to upgrade infrastructure to cater for new products and markets," Ooi stated.

"I am optimistic the group will be able to seek opportunities in 2010 and respond to the needs of the capital market, by providing sound risk management solutions for financial institutions to manage their liquidity and risks.

"At the same time, we seek to also provide existing and prospective investors with innovative bonds/Sukuk instruments to meet their respective requirements," he added.

For the financial year ended Dec 31, 2009, Cagamas Holdings Bhd's Group pre-tax profit was RM559.2 million, a decrease of RM5.1 million from 2008.

Meanwhile, its wholly owned subsidiary Cagamas Bhd recorded a pre-tax profit of RM294.5 million, an increase of RM65.2 million achieved on the strength of higher loans growth. ' Bernama

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