Khazanah bonds are issued by Khazanah Nasional Berhad under the principle of Murabahah. They are long-term zero coupon bonds and issued through auction on a competitive basis through the Principal Dealers.
The objective of the issuance of Khazanah bond is to develop the benchmark yield curve for the Ringgit bond market. The Khazanah bonds have the benefit of a guarantee by Government of Malaysia whereby the Government of Malaysia guarantees payment of face value of the outstanding bonds, or if any of the bonds become due and payable before their maturity date, the fair value of such bonds. The submission of bids in the primary issue is based on price per 100 basis points. The secondary market trading of the bond is based on the principle Bai’ Dayn.