Danaharta launches Malaysia’s first CLO

Malaysia’s national asset management company Pengurusan Danaharta Nasional Berhad (Danaharta), which is targted at resolving the country’s non-performing loan problem, has issued its first asset-backed securitisation (ABS) worth $81.6 million.

The transaction, a collateralised loan obligation (CLO), was rated triple-A by Rating Agency of Malaysia (RAM). Funds will be raised by securitising a portion of Danaharta’s portfolio of performing ringgit loans valued at approximately $150.2 million. The deal was lead-managed by Deutsche Bank and Alliance Merchant Bank.

“By securitising these performing loans, we are adding to the development of Malaysia’s bond markets,” said Dato’ Azman Yahya, chairman of Danaharta.

In April, the Malaysian Securities Commission (SC) published guidelines on debt securities offerings, which paved the way for the growth of ABS transactions in country. In September, Arab-Malaysian Bank launched Malaysia’s first ABS transaction, a $67.1 million collateralised bond obligation.

The Danaharta ABS, issued by a special purpose vehicle, Securita ABS One Berhad, has fixed-rate senior notes due in 2005 and is to be distributed via a private placement to Malaysian investors. Danaharta’s managing director, Encik Abdul Hamidy Hafiz, has also stated that it intends to launch further ABS transactions in the future. “The idea is to initiate the securitisation process this year and develop our knowledge and skills, while testing the market’s appetite for such securities,” he said.