Kuala Lumpur, 12 July 2011

SC revises Guidelines for corporate bonds and sukuk

The Securities Commission Malaysia (SC) today issued the revised Private Debt Securities (PDS) Guidelines, Sukuk Guidelines and Trust Deed Guidelines to enhance the regulatory framework for fundraising and product regulation in the Private Debt Securities and Sukuk markets.

The revisions are in line with the broader objectives of the Capital Market Masterplan 2 (CMP2) which seeks to achieve higher levels of operational efficiency, enhanced  standards for fair and ethical business practices and strengthen internal controls for business conduct and risk management.  

The revised PDS and Sukuk Guidelines streamline the approval process and time-to-market for the issuance of corporate bonds and sukuk. The revisions also facilitate a more informed investment decision-making process with additional provisions to ensure greater disclosure of relevant information to investors.

The revised Sukuk Guidelines provide greater clarity on the application of Shariah rulings and principles endorsed by the SC’s Shariah Advisory Council in relation to Sukuk transactions while the Trust Deed Guidelines improves disclosure standards and protection for corporate bond and sukuk holders.

Malaysia is currently the largest sukuk market in the world, accounting for about 65% of the global issues, while the bond market is the 3rd largest as a percentage to GDP in Asia (ex-Japan). The revised Guidelines will help Malaysia maintain its leading position by continuously attracting both local and international issuers and investors into the corporate bond and sukuk markets.

The revised Private Debt Securities Guidelines, Sukuk Guidelines and Trust Deed Guidelines will supersede the Guidelines on the Offering of Private Debt Securities, Guidelines on the Offering of Islamic Securities, Guidelines on the Minimum Contents Requirements for Trust Deeds and all the related Practice Notes respectively. The revised Guidelines are now available here.