Tuesday, May 19, 2009

Danajamin appoints rating expert as deputy CEO

By Habhajan Singh
Danajamin Nasional Bhd (Danajamin), the financial guarantee insurer set-up under the second national economic stimulus package, has appointed a rating expert as its deputy chief executive officer Khoo Boo Hock (picture), the head of infrastructure and utilities at RAM Rating Services Bhd, has been roped in to assist the yet to be named chief executive officer in steering the national financial guarantee provider, sources say.
Khoo, a rating specialist at the country's first rating agency, was involved from the inception of outfit meant to provide financial guarantee insurance to issues of private debt and Islamic securities, one of the measures intended to boost the bond market.
"He understands the bond market well," said one industry source.
Last Friday [May 15, 2009], Bank Negara Malaysia (BNM) announced that Datuk Seri Abdul Hamidy Abdul Hafiz, formerly the managing director and chief executive officer of Affin Bank Bhd from June 2003 to March 2009, as Danajamin chairman.
He was former the managing director of Pengurusan Danaharta Nasional Bhd, the nation's asset management company tasked to acquire the non-performing loans (NPLs) of banks following the 1997 financial turmoil.
Danajamin is one of the measures put into place to offer better access to capital for local businesses and is seen as the missing link in the local bond market.
The outfit is an AAA-rated financial guarantee insurer with a mission to facilitate capital raising by Malaysian companies from the capital markets by providing insurance protecting the holders of both Islamic and private debt securities against any missed payments or defaults. It was established as part of the RM60 billion stimulus package announced by the government on March 10.
It is a government owned entity which at present has an issued and paid-up capital of RM1 billion with a capacity to underwrite policies of up to RM15 billion. Danajamin facilitates access to long-term capital from the capital markets for investment grade Malaysian companies.
In exchange for a Danajamin insurance, issuers will pay a premium which will be competitively benchmarked against the prevailing cost of raising capital. Issues that have obtained a Danajamin insurance will be rated AAA(fg).
Danajamin is a licensed insurance company under the Insurance Act 1996 and is regulated and supervised by Bank Negara Malaysia.
The other Danajamin directors are Datuk Mohd Hanif Sher Mohamed (former CEO of Credit Corporation (Malaysia) Bhd), Datuk Albert Yeoh Beow Tit (former CEO OCBC Bank Malaysia Bhd and a current director at Cagamas Bhd and Great Eastern Assurance Malaysia Bhd, Datuk Mohammed Hussein (former executive director and deputy President of Malayan Banking Bhd), George Ratilal (former managing director of RHB Sakura Merchant Bankers Bhd and now a vice president for finance at Petronas), Philip Tan Puay Koon (former country treasurer of Citibank Bhd), Nik Mohd Hasyudeen Yusoff (current president of the Malaysian Institute of Accountants), and Abdul Kadir Md Kassim (current managing partner of Messrs Kadir, Andri & Partners).

(This story appeared in The Malaysian Reserve on May 19, 2009. The Malaysian Reserve is a daily business/finance newspaper published out of Kuala Lumpur, with a sectoral page on Islamic finance on Mondays, edited by Habhajan Singh)

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