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OPERATIONAL PROCEDURES FOR SECURITIES SERVICES

Doc. Ref. No.: 500-100/1/0000139

Version 3.7

Proprietary Rights

The information contained in this document is proprietary and confidential to Payments Network Malaysia Sdn Bhd (PayNet) and its subsidiary companies (PayNet Group). All rights reserved. This material may not be duplicated, published,

or disclosed, in whole or in part, without the prior written permission of PayNet.

Operational Procedures for Securities Services (V3.7) Doc. Ref. 500-100/1/0000139

© 2021 PayNet. Public. Page 2 of 208

Document Details

Document Owner : Large Value Payments and Securities Services

Effective Date : 9 February 2021

Revision History

Version No.

Date of Update

Summary of Change Updated By

1.0 17 Feb 2011 Approved version MyClear

1.1 06 May 2011 • Change from “Depository Paying Agency Agreement

(DPAA)” to “Central Securities Depository and Paying

Agency Rules (CSDPAR)” – Clauses affected:

- 9.2.2.

- 9.2.3.

- 9.2.3.1.

- 33.4

- 33.5

- 35.2

- 35.4

• Change from “Authorized Depository Institutions (ADIs)”

to “SSDS Participants”.

MyClear

1.2 21 Feb 2012 Clause 1.2.8

Rewording of Operational Procedure for MYR Real Time

Electronic Funds Transfer and Securities System

Clause 1.2.9

Added Operational Procedures for Multi-Currency Settlement

in the Real time Electronic Transfer of Funds and Securities

System

Clause 3.2

Replaced 06 May 2011 with 1 March 2012

Clause 10.2

Added processing of new FAST administrator IDs for FAST and

eSSDS application

Clause 10.1.6

Added responsibility of FAST administrator

Clause 10.1.7

Added reference Appendix on User Request Form (USER ID) for

FAST

Clause 11.2

Amended the Administrative Cut-Off times to provide

additional flexibility for issuance for specific RENTAS securities

Clause 12.0

Removal of Fees and charges for standardization with

MyClear



Version No.

Date of Update


Participation and Operational Rules for Payments and

Securities Services

Clause 12.3

Amended the General Tender Invitation timeline to provide

greater flexibility for issuance of specific RENTAS securities

Clause 15.3

Amended the New Issuances Creation and Maintenance

timeline to provide greater flexibility for issuance of specific

RENTAS securities

Clause 16.3

Amended the Re-Opening timeline to provide greater flexibility

for issuance of specific RENTAS securities

Clause 19.2

Amended the Tender Procedure – Tender Invitation timeline to

provide greater flexibility for issuance of specific RENTAS

securities

Clause 28.5

Replaced Clause 29.4 with 28.4

Clause 32.0

Amended the timeline to provide greater flexibility for issuance

of non-specific RENTAS securities

Clause 35.3



Clause 37.3



Clause 40.2



Clause 51.5


Clause 53.9

Replaced 12.2.1 with Participation and Operation Rules for

Payments and Securities Services, Appendix III (B.9.0)



Version No.

Date of Update


Clause 54.9



Clause 55.8



Clause 58.5


Clause 59.9



Clause 60.9



Clause 61.8



Part V

Added Issuing Procedures For Non-Specified RENTAS Securities

Denominated in Foreign Currencies (Non-USD).

Clause 69.3

Replaced “When Issued” trading is on Price with “With Issued

is traded on the yield basis regardless of new or reopened

issue, up to three (3) decimal places.”

Part VI

Rewording of Trading Principles and Procedure for Secondary

Market Securities Denominated in MYR and USD

Part VII

Added Trading Principles and Procedure for Secondary Market

Securities Denominated in Foreign Currencies (Non-USD).

Clause 86.2.2.2

Replaced Clause 80.1.2.4 with 85.1.2.4

Clause 90.1.2.2


Clause 92.1.4.3




Version No.

Date of Update


Clause 93.1


Guideline III

Rewording Compensation of Delayed Failed Settlements of

MYR and Foreign Currency Securities Transactions

Clauses 3.2, 3.3, 4.2 and 4.3

Inclusion of compensation formula for Renminbi and USD

Rewording of certain terminology as the compensation

formula is used for conventional and Islamic banking.

Appendices

Added Appendix VII User Application Form.

1.3 30 Mar 2012 Clause 2.1

Update Scope statements.

Clause 3.2

Replaced 1 March 2012 with 9 April 2012

Clause 11.2 Item 1, Item 2 and Item 3

Facility creation and notice period for allotment of Specified

RENTAS Securities and Non-Specified RENTAS Securities is

reduced to at least two Business days.

MyClear

1.4 07 May 2012 Clause 7.2

Insert new clause to describe which securities are dematerialised and immobilised.

Clauses 9.7.1 and 9.7.2

Amended to strengthen protection of customer assets in the event of insolvency of SSDS Participants. Clause 12.2, 12.3 and 32.2

Insert 3 new clauses to reflect which types of securities are dematerialised and immobilised.

Clause 36.2

Reworded to provide clarity on process of changing stock

transferability status.

Clause 36.3.4

Reworded to provide clarity on process of changing stock

transferability status and changing list of authorized holders.

Clause 68.3.2 and 68.3.3

Rewording of clause 68.3.2 and added clause 68.3.3 to reflect the cancellation in RENTAS for pending transactions.

MyClear



Version No.

Date of Update


Guideline I

Inserted clauses to provide clarity on applicable fees and on the timeline needed for changes.

Appendices

Insert new Appendix VIII -FAST / eSSTS – Parameter Update Form.

1.5 11 Sep 2012 Clause 9.7.2.10 Amended to tighten the control for disclosure of customer information to third party in line with the applicable laws. Clause 11.3.2.2 Change of cut-off time from 11:00am to 12:00 noon as to improve efficiency of securities settlement. Clause 32.6 Rewording to include the requirement to submit one Securities Lodgement Form for every facility by FA. Clause 32.8 Change of time for Global Certificates submission to MyClear. Clause 52.8 Added new clause to ensure that the correct withholding tax submission to LHDN by MyClear. Clause 55.11 and 61.10 Change of Global Certificates collection / submission mode.

MyClear

1.6 05 Dec 2012 Clause 55.11 Added “at their risks” to the clause as to ensure that risk involved lies with the FA.

MyClear

1.7 06 Sep 2013 Clause 1.2.3 Replace references to the Payment System Act (PSA), with references to the Financial Services Act (FSA). Clause 5.1.3 and 10.4 The form in Appendix VII has been renamed to “External User Access Request Form” Clause 9.2.3.8 Added new clause to inform participants they can now extract bondholder information through FAST. Clause 9.2.3.9 and 9.2.3.10 Strengthen procedures for disclosing information to meet requirements for “permitted disclosures” under Section 134, Schedule 11 Clause 1 of the FSA. Clause 9.7.2.8 Strengthen requirement that proceeds must be paid to customers before RENTAS cut-off. Euroclear defined dates based on Brussels time, and paid customers before the end of the day based on Brussels time to the detriment of their customers investing in Malaysian bonds.

MyClear



Version No.

Date of Update


Clause 11.2.9 To reflect the correct cut-off time for Settlement of Allotments by subscribers Clause 11.3.2.2 Make reference to central Administrative Cut-off table instead of repeating the cut-off time across many clauses. To include option of settling via OSI. Clause : • 29.4 • 30.4 • 31.3 • 51.7 • 51.8 • 51.9 • 51.10 • 51.11 • 53.5 • 53.6 • 53.7 • 53.9 • 53.13 • 54.5 • 54.6 • 54.7 • 54.9 • 54.13

• 55.4 • 55.5 • 55.6 • 55.8 • 55.12 • 58.8 • 58.10 • 58.11 • 59.6 • 59.9 • 59.13 • 60.6 • 60.9 • 60.13 • 61.5 • 61.8 • 61.11 • 28.6

Make reference to central Administrative Cut-off table instead of repeating the cut-off time across many clauses. Clause 32.10 To provide clarity that MyClear will only return existing Global Certificates only after the FA provides replacement of affected Global Certificates. Clause 52.8 Re-wording of clause to provide clarity and corrected the define term. Clause 52.9 Added new clause to state FAs’ responsibility to withhold taxes when they make coupon payments outside RENTAS. MyClear has confirmed with LHDN that FAs assume the responsibility to remit withholding taxes to LHDN if the FAs opt to make coupon payments directly to investors. Clause 55.11 Provides clarity that FAs must collect their certificates within 14 Business days. Guideline I – Clause 2.0 Capitalized the word “agent” Guideline I – Clause 3.1 Added change of maturity date as one of the chargeable changes to stock information.



Version No.

Date of Update


Appendix I Reflect MyClear’s New Address: Director Large Value Payments and Securities Services Division Malaysian Electronic Clearing Corporation Sdn Bhd (MyClear) Level 10, Tower 2A, Avenue 5, Bangsar South 8, Jalan Kerinchi 59200 Kuala Lumpur Appendix IX

New Appendix to provide sample of Bondholder Information Request Form. Appendix X

New Appendix to provide sample of Authorisation Form To Disclose Information For Administration Of Securities Deposited in RENTAS and Lodgement of Authorised Signatories letter.

1.8 06 Dec 2013 Clause 9.2.3.7, 51.10, 53.13, 54.13, 55.12, 58.10, 59.13, 60.13, and 61.11 Ensure that defaults or delays in payments are made known to the market immediately.

MyClear

1.9 06 Jun 2014 Guideline I – Clause 3.1 Added a new item (bullet/revolving) as critical information under Debt Facility information as the field is viewed as critical and cannot be amended.

MyClear

2.0 10 Dec 2014 Document Reference Number Updated document reference number from 500-100/0139 to 500-100/1/0000139. Clause 5.2 Inserted clause to define categories of “FAST Membership” and applicable admission requirements. Clauses 29.2 and 59.2 Amended the cut-off time to key in Early Redemption and clarify that FAs cannot perform Early Redemption for securities in Participants’ Collateral Account. Clauses 30.2 and 60.2 Amended the cut-off time to key in Partial Redemption and clarify that FAs cannot perform Partial Redemption for securities in Participants’ Collateral Account. Clause 32.2 To make clear that both bearer and registered Non-Specified RENTAS Securities may be lodged with MyClear. Clause 32.7 Provide clarity that global certificates for Non-Specified RENTAS Securities in registered form would be registered in the name of BNM.

MyClear



Version No.

Date of Update


Clauses 48.1, 48.2, 48.3, 48.4, 48.5 and 48.6 Replaced references to “Tender Panel Members” with “subscribers”. Clause 48.4 Synchronize the cut-off time for payment of allotment proceeds from the FAs to Issuers. Clause 56.2 Incorporated requirement for submission of global certificates for Non-Specified RENTAS Securities denominated in USD. Clause 93.3 Deleted the last sentence “In the event the maturity date falls on a non-Business day, the maturity date shall be the preceding Business day” for consistency purposes. Clauses 95.2.3 and 95.3.3 Added new clauses for foreign currency conventional and Islamic Private Debt Securities. For coupon payment date and redemption payment date that fall on expected or unexpected holiday, payment of such shall be by default made on the following Business day. Issuers or FAs are allowed to opt for different holiday conventions based on the relevant offering documents for the Debt Securities. Guideline I – Clause 3.2 Added a new item (bullet/revolving) as critical information under Debt Securities Information as the field is essential and cannot be arbitrarily amended.

3.0 09 Aug 2016 Clause 7.2 Replaced “Private Debt Securities” with “Corporate Bonds and Sukuk” in accordance with a circular issued by Bank Negara Malaysia on 22 July 2016. Similar term replacement is effected throughout this Operational Procedures. Clauses 11.2 and 11.3 To distinguish cut-off timing for different settlement locations, namely onshore and USD CHATS in Hong Kong. Part III Merged issuing procedures for Non-Specified RENTAS Securities denominated in MYR and Foreign Currencies Settled On-shore. Clause 32.1 Replaced the term PDS with CBS in line with amendment for Clause 7.2 Clause 32.7 Highlighted requirement to state Stock Code or International Securities Identification Number (ISIN) on Global Certificates. Clause 32.10 Included Re-opening and extension of maturity events for replacement of Global Certificates.

MyClear



Version No.

Date of Update


Clause 32.13 Resequenced clause from Part V of Operational Procedures for Securities Services Version 2.0, arising from the merging of issuing procedures for Non-Specified RENTAS Securities denominated in MYR and Foreign Currencies Clauses 48.6, 48.7 and 48.8 Inserted new process flows for Settlement of Allotment to be in line with new process flow in RENTAS. Clauses 51.2 and 58.2 Provided FAs with flexibility to amend coupon payment dates. Clauses 51.6, 51.8, 51.9, 53.4, 53.6, 53.7, 54.4, 54.6, 54.7, 55.3, 55.5 and 55.6 Updated process flows to be in line with new process flow in RENTAS. Clause 56.1 Clarified that Part IV of this Operational Procedures relates to Non-Specified RENTAS Securities denominated in USD which are settled via USD CHATS. Clauses 58.6, 58.8, 59.4 and 59.6 Updated references to cut-off time for settlement through USD CHATS. Clause 64.1 Updated Settlement Deadline for Same Day Value Transactions. Clause 65.1 Updated Trades Confirmation Deadlines for Tomorrow Value, Standard Value and Forward Value Transactions. Clauses 65.2 and 65.3 Updated process flows to be in line with the new flow in RENTAS. Clause 66.0 Resequenced clauses from Part VII of Operational Procedures for Securities Services Version 2.0, for Managing Unmatched Transactions Clause 71.1 Reflected new flows for Settlement Confirmation and Transaction Status Guideline III Updated cut-off time for MYR and foreign currency Standard/Forward Trades in Clause 2.1 Appendix VIII Renamed eSSTS to eSSDS

3.1 15 May 2017 Clause 9.2.3.4 Included Reopening and Maturity Extension as events that require replacement of Global Certificate

MyClear



Version No.

Date of Update


Clause 9.2.3.6 To make reference to Administrative Timeline Clause 9.2.3.8 Removed FAST as a source to obtain information Clause 11.2.12 Incorporated Global Certificate submission deadlines in Administrative Timeline Clause 32.8, 32.9, 32.10, 54.12 and 60.12 To make reference to Administrative Timeline Clause 39.2.3 Inserted new clause to provide option to FAs for direct placement of securities to SSDS Participants’ account for customer Clause 52 Revised and resequenced existing clauses (Clause 52.1 to Clause 52.8 and Clause 52.15) as well as inserted new clauses (Clause 52.9 to Clause 52.14) to reflect new Withholding Tax requirements in 2017 Clause 53.12 and 59.12 Synchronised the Global Certificate return process with Full Redemption Clause 65.2 and 65.3 Removed table to provide flexibility to Participants to issue own format of completion advice to non-interbank institutions Clause 68.4 and Clause 68.5 Reworded to provide flexibility to Participants on handling “When Issued” deals Guideline I – Clause 1.0 Highlighted MyClear’s right to reject FA’s request on changes to critical information Appendix XI Inserted new template form of Withholding Tax Declaration Form (Intra-Group NR Investors) Appendix XII Inserted new template form of Withholding Tax Declaration Form (SSDS Participant)

3.2 01/01/2018 All relevant contents throughout the document Replaced MyClear with PayNet in the entire document Clause 52.0 Inserted the following subheaders for clarity on handling of withholding tax for different types of debt securities:

• Clause 52.1 • Clause 52.2

PayNet



Version No.

Date of Update


Clause 87.1.1.1 For clarity, this clause specifies events that may lead to non-settlement of SBBA transactions Clause 89.1, 89.2 and 89.3 Streamlined the administrative cut-off times for tenders that fall on unexpected holidays Guideline I – Clause 2.0 and 3.2 Clarified the submission timeline for requests to amend critical information and removed “Transferability” as critical information in the Debt Securities Information Appendix X Renamed ‘Authorisation Form’ to ‘Authorised Signatories’

3.3 01/06/2018 Changed “Participation and Operation Rules for Payments and Securities Services” to “Participation Rules for Payments and Securities Services” throughout the document. Clause 2.0 – Scope (in previous version 3.2)

• Moved to clause 1.2

Clause 3.0 – Purpose (in previous version 3.2) • Moved to clause 1.3

Clause 4.0 - Description of FAST, Clause 6.0 - Description of eSSDS and Clause 7.0 - Description of RENTAS (in previous version 3.2)

• Moved to new Glossary section Clause 5.0 – Participation by New Institution (in previous version 3.2)

• Renumbered to clause 3.0 and renamed as “FAST Membership”.

• Added new clause 3.1 to make reference to the Membership section in the Participation Rules for Payments and Securities Services

Clause 5.2 – FAST Membership (in previous version 3.2)

• Renumbered to clause 3.2 and renamed as ‘FAST Membership Criteria’

Clause 4.0 – Participants Representation (New)

• Inserted new clause to describe the roles and responsibilities of the FAST Focus Group and the Rules Working Committee (RWC)

Clause 9.0 – Users of the System (in previous version 3.2) • Renumbered to clause 5.0 • Inserted new clause 5.1.2 which was taken from

clause 17.1 of the Participation and Operation Rules for Payments and Securities Services V3.3

• Amended clause 5.2.1 to incorporate clause 17.2 from the Participation and Operation Rules for Payments and Securities Services V3.3

• Inserted new clause 5.2.2 which was taken from clause 17.3 in the Participation and Operation Rules for Payments and Securities Services V3.3

PayNet



Version No.

Date of Update


• Inserted new clause 5.2.4.4 which was taken from clause 17.6 of the Participation and Operation Rules for Payments and Securities Services V3.3

• Amended clause 5.3.1 to incorporate clause 17.4 from the Participation and Operation Rules for Payments and Securities Services V3.3

Clause 5.7 – Indicative Yield-to-Maturity (YTM) Contributors (New)

• Added new clause, which was taken from clause 17.9, 17.10 and 17.11 of the Participation and Operation Rules for Payments and Securities Services V3.3

Clause 70.0 – Dispute Resolution

• Inserted new clause 70.1 to make reference to the ‘Dispute Management’ section in the Participation Rules for Payments and Securities Services

Appendix II – Fees and Charges (New) • Added new Appendix II. A on ‘FAST Fees’ (now

renamed as Securities Services Fees) which was taken from Appendix II.B of the Participation and Operation Rules for Payments and Securities Services V3.3

• Inserted new item 10.0 on penalty for ‘General Non-compliance’ under Appendix II.A

• Added new Appendix II. B on ‘Depository Fee’ and ‘Safe-keeping fee’ which was taken from item 18.0 in Appendix II.A of the Participation and Operation Rules for Payments and Securities Services V3.3

• Moved item 7.0 ‘Annual Depository Fee’ from Appendix II.B of the Participation and Operation Rules for Payments and Securities Services V3.3 to item 2.0 under Appendix II. B

Glossary (New) • Definitions applicable to Securities Services in

Participation and Operation Rules for Payments and Securities Services v3.3 have been removed and inserted to this Operational Procedures

3.4 01/01/2019 Clause 5.8 - SSDS Participants • Incorporated the requirement of maintaining

Segregated Securities Accounts for customers in RENTAS in clauses 5.8.2.1 and 5.8.2.2

Part II - ISSUING PROCEDURES FOR MULTICURRENCY SPECIFIED RENTAS SECURITIES SETTLED ON-SHORE

• Amended header in Part II to cover the issuing procedures for multicurrency issuances settled onshore for Specified RENTAS Securities

Part IV - ISSUING PROCEDURES FOR SPECIFIED AND NON-SPECIFIED RENTAS SECURITIES DENOMINATED IN USD WITH USD SETTLEMENT VIA USD CHATS

• Amended header in Part IV to cover the issuing procedures for USD issuances settled via USD CHATS for Specified RENTAS Securities

PayNet



Version No.

Date of Update


Part XI - INCIDENT REPORT (New) • Inserted new requirement for Participants to submit

Incident Report

Guideline II, item No.2 - Discounted Specified and Non-Specified RENTAS Securities

• Amended the header in Guideline II, item No.2 to clarify that the discounted proceeds formula is applicable to both Specified and Non-Specified RENTAS Securities

Appendices

• Inserted a general statement to highlight that template forms may be subject to changes

Appendix XV - Incident Report from Participants (New)

• Inserted new appendix as template for incident report

3.5 21/08/2019 Clause 3.0 – FAST Membership

• Inserted new sub-header (Clause 3.3 – FAST Membership Admission) to streamline and clarify the admission process for FAST. Rearrange existing clauses 3.2.6 to 3.2.10 to clarify sequence of the application procedures.

Clause 5.7 – Indicative Yield-to-Maturity (YTM) Contributors

• Reorganised clause 5.7.1 (previous version 3.4) into clauses 5.7.1 and 5.7.2 to emphasise the obligations of Principal Dealers and Islamic Principal Dealers to submit YTM for Corporate Bonds/Sukuk

Clause 32.0 – Transferability of Debt Securities

• Removed clauses 32.2.1 and 32.3.4 as the clauses are no longer applicable

• Merged clause 32.2.2 (previous version) into clause 32.2.

Clause 60.0 – Trading Hours and Settlement Deadlines & Clause 61.0 - Matching of Transactions for Securities (previous version 3.4)

• Merged both clauses above and its sub-clauses into a new clause 60.0 and renamed as ”Transaction Initiation and Settlement Deadlines for Securities”

• Aligned transaction initiation and settlement deadlines with the Operational Procedures for Malaysian Ringgit Settlement in RENTAS

Appendix VIII – External User Access Request Form (USER ID)

• Replaced form with the latest version

PayNet

3.6 05/06/2020 Clause 5.8 – SSDS Participants • Added reference to a new user guide in clause 5.8.2.1

to provide SSDS Participants with access of information to set up Segregated Securities Account (SSA) in FAST and its application.

Clause 6.0 – Security of the Systems

• Amended clauses 6.2, 6.3 and 6.4 to clarify the process of maintaining FAST Administrators and the roles of FAST Administrators to manage their participants’ IDs.

PayNet



Version No.

Date of Update


Clause 24.0, 47.0 and 54.0 – Coupon/Interest/Dividend/Profit Payment

• Amended clauses 24.4 and 47.4 to clarify the computation of coupon is based on securities account level and no longer custody code due to implementation of SSA

• Rectified the reference source of fee schedule in clauses 47.11 and 54.11

Clause 60.0 - Transaction Initiation and Settlement Deadlines for Securities

• Inserted new clause (Clause 60.6) to reflect settlement deadlines for MGS Futures Contract

Clause 68.0 – Delayed or Failed Settlement

• Inserted new clauses (Clause 68.5, 68.6 & 68.7) to clarify that all failed settlement of Securities Linked Settlement for MGS Futures Contract shall be referred to Bursa Malaysia Derivatives Clearing Bhd.

Glossary of Terms

• Amended definition of “Commercial Papers” in order to remove redundant word.

• Amended definition of “General Non-Compliance” in order to update the document name for Participation Rules and this Operational Procedures

3.7 04/12/2020 Clause 7.2

• Amended cut off times for payment from Issuers to FAs

Clause 49.12, 51.11, 55.12 and 57.10

• Extended Global Certificates collection period from 7 to 14 Business days

Appendix II – Fees and Charges

• Removed fees applicable to IILM and IILM’s Principal Dealers as no longer applicable

• Amended metrics for One-Time Depository Fee

Administrative Changes • Replaced document's security classification from

“Confidential” to “Public”

PayNet



Table of Content

Introduction ...................................................................................................................... 20

Overview of Systems Linkages .......................................................................................... 22

FAST Membership ............................................................................................................. 23

Participants Representation ............................................................................................. 26

Users of the Systems ......................................................................................................... 29

Security of the Systems ..................................................................................................... 36

Administrative Cut-Off Times ........................................................................................... 37

General ............................................................................................................................. 41

Issuer Creation and Maintenance ..................................................................................... 42

Debt Facilities Creation and Maintenance ....................................................................... 43

New Issuances Creation and Maintenance ...................................................................... 44

Re-opening of Debt Securities .......................................................................................... 45

Mode of Offer ................................................................................................................... 46

Private Placement Procedure ........................................................................................... 47

Tender Procedure – Tender Invitation ............................................................................. 48

Tender Procedure – Submission of Bids ........................................................................... 49

Tender Procedure – Bids Monitoring ............................................................................... 50

Tender Procedure – Tender Processing ............................................................................ 51

Intervention by Issuers or FAs .......................................................................................... 52

Tender Result .................................................................................................................... 53

Secondary Notes Creation ................................................................................................ 54

Settlement for Allotment .................................................................................................. 55

Non-Settlement for Allotment .......................................................................................... 56

Coupon / Interest / Dividend / Profit Payment ................................................................ 57

Early Redemption ............................................................................................................. 58

Partial Redemption ........................................................................................................... 59

Final Redemption .............................................................................................................. 60

General ............................................................................................................................. 61

Issuer Creation and Maintenance ..................................................................................... 63

Debt Facilities Creation and Maintenance ....................................................................... 64

New Issuance Creation and Maintenance ........................................................................ 65

Transferability of Debt Securities ..................................................................................... 66

Re-opening of Debt Securities .......................................................................................... 67

Mode of Offer ................................................................................................................... 68

Private Placement Procedure ........................................................................................... 69

Tender Procedure – Tender Invitation ............................................................................. 70



Tender Procedure – Submission of Bids ........................................................................... 71

Tender Procedure – Bids Monitoring ............................................................................... 72

Tender Procedure – Tender Processing ............................................................................ 73

Tender Procedure – Tender Processing with Underwriting Facility ................................. 74

Intervention by Issuers or FAs .......................................................................................... 75

Tender Result .................................................................................................................... 76

Secondary Notes Creation ................................................................................................ 77


Non-Settlement of Allotment with Underwriting Facility ................................................ 80

Non-Settlement of Allotment without Underwriting Facility ........................................... 81


Withholding Tax ................................................................................................................ 84


Partial Redemption ........................................................................................................... 90

Final Redemption .............................................................................................................. 92

General ............................................................................................................................. 94




Partial Redemption ......................................................................................................... 101

Final Redemption ............................................................................................................ 103

General Rules .................................................................................................................. 105

Types of Trades ............................................................................................................... 108

Transaction Initiation and Settlement Deadlines for Securities ..................................... 109

Managing Unmatched Transactions ............................................................................... 110

Amendment and Cancellation ........................................................................................ 111

“When Issued” Trading ................................................................................................... 112

Settlement Principles ...................................................................................................... 113

Repurchase Agreement (Repo) ....................................................................................... 114

Settlement of Suspended Debt Securities ...................................................................... 116

Settlement of Maturities for Script Securities ................................................................ 117

Delayed or Failed Settlement ......................................................................................... 119

Dispute Resolution .......................................................................................................... 120

General ........................................................................................................................... 121

Tender Procedure ........................................................................................................... 122



Settlement ...................................................................................................................... 126

A. PROCEDURES FOR BANK NEGARA MALAYSIA’S REPO TRANSACTIONS .......................... 127

General ........................................................................................................................... 127

Collateral Eligibility, Margin System and Collateral Valuation ....................................... 128

Repo and Reverse Repo Tender Procedure .................................................................... 130

Bilateral Repo and Reverse Repo Procedure .................................................................. 135

B. PROCEDURES FOR BANK NEGARA MALAYSIA’S SELL AND BUY-BACK AGREEMENT (SBBA) TRANSACTIONS ............................................................................................................... 137

General ........................................................................................................................... 137

Assets Eligibility, Margin System and Assets Valuation .................................................. 138

SBBA and Reverse SBBA Tender Procedure .................................................................... 140

Bilateral SBBA and Reverse SBBA Procedure .................................................................. 144

Settlement ...................................................................................................................... 145

Settlement Failure .......................................................................................................... 146

Business Day ................................................................................................................... 149

Tender Closing Date and Issue Date ............................................................................... 150

Coupon / Interest / Dividend Profit Payment Date and Redemption Date .................... 153

General ........................................................................................................................... 156

Full Disaster and Partial Disaster .................................................................................... 157

Manual Back-up Procedure for FAs ................................................................................ 158

Manual Back-up Procedure for Direct Bidder and Indirect Bidder ................................. 159

Manual Back-up Procedures for PayNet and BNM (Money Market Tender and Repo Tender) ............................................................................................................................ 160

General ........................................................................................................................... 162

Guideline I - List Of Critical Information In FAST ............................................................................. 163

Guideline II - Calculation Of Interest, Accrued Interest And Redemption Proceeds ...................... 165

Guideline III - Compensation Of Delayed Or Failed Settlements Of MYR And Foreign Currency Securities Transactions ................................................................................................... 172

Appendix I – Confirmation of Participation in FAST........................................................................ 178

Appendix II – Fees and Charges ...................................................................................................... 179

Appendix III – Samples of Bidding Reports ..................................................................................... 181

Appendix IV – Sample of SWIFT Payment for Allotment Settlement ............................................. 188

Appendix V – Sample of SWIFT Payment for Coupon Payment ..................................................... 189

Appendix VI – Sample of SWIFT Payment for Early/ Partial/ Final Redemption Payment ............. 190

Appendix VII – Manual Tender Form .............................................................................................. 191

Appendix VIII – External User Access Request Form (USER ID) ...................................................... 192

Appendix IX – FAST / eSSDS – Parameter Update Form ................................................................. 194



Appendix X – Bondholder Information Request Form.................................................................... 195

Appendix XI – Authorised Signatories ............................................................................................. 196

Appendix XII – Withholding Tax Declaration Form (Intra-Group NR Investors) ............................. 197

Appendix XIII – Withholding Tax Declaration Form (SSDS Participant) .......................................... 199

Appendix XIV – Incident Report from Participants ......................................................................... 200



GENERAL

1.0 Introduction

1.1. Two systems are involved in Debt Securities processing, namely FAST and RENTAS. In addition,

eSSDS, which is a part of RENTAS, is used for the computation of corporate actions involving

Debt Securities and issuance of retail bonds.

1.2. These Operational Procedures apply to all RENTAS Debt Securities approved by the Securities

Commission of Malaysia, Debt Securities issued by Bank Negara Malaysia (BNM) and the

Government of Malaysia, and other approved Debt Securities or money market instruments

which are denominated in Ringgit Malaysia (RM) or any other foreign currency. Securities

deposited with PayNet under the Cross-Border Securities Custody Services (CSCS) are

excluded from the scope of these Operational Procedures.

1.3. These Operational Procedures are intended to equip Participants with an effective operating

knowledge of the entire process from origination until the final maturity of Debt Securities. It

will cover New Issuances, Allotment, Reopening, Coupon / Interest / Dividend / Profit

Payment, Redemption and Settlement of Debt Securities via FAST, eSSDS and RENTAS.

1.4. These Operational Procedures shall be read in conjunction with the following documents:

1.4.1. Financial Services Act 2013 (FSA) and Islamic Financial Services Act 2013 (IFSA);

1.4.2. Capital Market Services Act 2007;

1.4.3. Securities Commission Act 1993;

1.4.4. Loan (Local) Ordinance 1959;

1.4.5. Treasury Bills (Local) Act 1946;

1.4.6. Government Funding Act 1983;

1.4.7. Participation Rules for Payments and Securities Services;

1.4.8. Operational Procedures for MYR Settlement in the Real Time Electronic Transfer of

Funds and Securities System;

1.4.9. Operational Procedures for Foreign Currency Settlement in the Real Time Electronic

Transfer of Funds and Securities System;

1.4.10. Central Securities Depository and Paying Agency Rules;



1.4.11. Guidelines on Unlisted Capital Market Products under the Lodge and Launch

Framework; and

1.4.12. Any other rules issued by relevant authorities.



2.0 Overview of Systems Linkages

2.1. Debt Securities created in FAST are automatically interfaced to eSSDS and subsequently to

RENTAS for Settlement purposes.

Trade Reporting

Computation of Corporate Actions

Origination of Debt Securities

NWI / Internet FAST

Depository / Settlement

eSSDS

ETP

RENTAS

Participants

NWI

• Commercial Banks • Investment Banks • Islamic Banks • Rating Agencies • Other Institutions

Participants



3.0 FAST Membership

3.1. This Clause 3.0 shall be read in accordance with the Membership section in the Participation

Rules for Payments and Securities Services.

3.2. FAST Membership Criteria

3.2.1. FAST membership is open to entities that meet the following criteria:

i. Licensed financial institutions and intermediaries regulated by BNM and/or the

Securities Commission of Malaysia;

ii. Qualified institutions who participate in MYR debt securities issuance or money

market;

iii. Qualified foreign licensed financial institutions that bid for or issue foreign

currency bonds that are not deposited in RENTAS;

iv. Qualified institutions who are admitted into FAST to carry out specific specialized

functions, such as providing credit ratings and other financial market information;

v. Asset managers, investment agencies and institutional investors who participate

in FAST to obtain financial information;

vi. Qualified institutions whose admission will promote the development of the

Malaysian financial markets.

3.2.2. The FAST membership shall be categorized based on the criteria set out in Clause 3.2.1

above and the level of participation which can be either full participation or limited

participation.

3.2.3. Full participation is applicable to institutions that are involved in all or any of the

essential activities that have direct and primary impacts to securities issuance,

depository and settlement.

3.2.4. Limited participation is applicable to institutions that conduct only specialized

functions which support the essential activities.



3.2.5. The FAST memberships are classified as below:

Type Category

FULL PARTICIPATION

F1 Licensed financial institutions and intermediaries regulated by BNM

and/or the Securities Commission of Malaysia

F2 Qualified institutions who participate in MYR debt securities issuance

or money market

LIMITED PARTICIPATION

L1 Qualified foreign licensed financial institutions that bid for or issue

foreign currency bonds that are not deposited in RENTAS

L2 Qualified institutions who are admitted into FAST to carry out specific

specialized functions, such as providing credit ratings and other

financial market information

L3 Asset managers, investment agencies and institutional investors who

participate FAST to obtain financial information

L4 Qualified institutions whose admission will promote the development

of the Malaysian financial markets

3.3. FAST Membership Admission

3.3.1. Potential participants seeking admission to FAST shall fulfil the following

requirements:

i. Demonstrate financial soundness.

ii. Have sufficient expertise and resources to operate FAST.

iii. Possess sufficient risk management and business continuity planning framework

and policies.

3.3.2. Documents that must be submitted for the participation application shall include:

i. The latest three (3) years audited financial statements.

ii. Certificate of incorporation.

iii. Board resolution approving participation in FAST.

iv. Memorandum and articles of association.



3.3.3. Potential Participants’ application for admission will be considered in accordance with

Clause 4.0 of the Participation Rules for Payments and Securities Services.

3.3.4. Participants may be requested to submit documents on an annual basis to provide

evidence that they are in compliance with the requirements outlined in Clause

3.3.3.1.

3.3.5. PayNet may waive document submissions for entities that are regulated by BNM, or

entities under BNM’s purview.

3.3.6. Upon approval by PayNet, the new Participants shall undertake the following:

i. Complete and submit the “Confirmation of Participation” form to PayNet as per

Appendix I.

ii. Notify PayNet in writing two (2) weeks before the actual implementation date of

operations.

iii. Submit the “External User Access Request Form” in Appendix VIII to request the

creation of two FAST Administrator IDs for two authorized officers of the

Participant. These FAST Administrator IDs will be able to create IDs and assign

access rights for the new Participants’ officers.



4.0 Participants Representation

4.1. FAST Focus Group

4.1.1. To ensure that Participants are kept updated and consulted regarding securities

services matters, PayNet conducts formal discussion with the Facility Agents via FAST

Focus Group.

4.1.2. FAST User Group is held minimum twice annually for PayNet and Facility Agents to:

4.1.2.1. Deliberate and agree on changes deemed necessary for FAST for the better

conduct of securities services operations

4.1.2.2. Co-ordinate and implement FAST initiatives on a timely basis

4.1.2.3. Discuss and provide updates of FAST rules and procedures based on

market requirements

4.1.2.4. Gather industry feedback and views on business development, operation

and governance of unlisted debt securities

4.1.3. Facility Agents as the main FAST users who operate primary securities market

operations shall represent their organizations to attend the FAST Focus Group.

Invitation to FAST Focus Group may be extended to other FAST users on adhoc basis

subject to requirements.

4.2. Rules Working Committee (RWC)

4.2.1. The RWC is a Committee consisting of industry representatives who advise and guide

PayNet in respect to any proposed changes and/or developments in the Rules and

Operational Procedures of RENTAS, FAST and eSPICK.

4.2.2. The role of RWC is to:

4.2.2.1. Ensure that any issues arising from any developments in the Rules and

Operational Procedures of RENTAS, FAST and eSPICK are consulted and

deliberated.

4.2.2.2. Co-ordinate and ensure implementation of improvements and changes to

the RENTAS, FAST at their respective organizations.



4.2.3. Composition of RWC

4.2.3.1. The RWC shall consist of the following members:

4.2.3.1.1. One representative from PayNet;

4.2.3.1.2. One representative from Bank Negara Malaysia;

4.2.3.1.3. Two representatives from the Association of Banks in

Malaysia (ABM);

4.2.3.1.4. Two representatives from the Association of Islamic Banking

Institutions Malaysia (AIBIM);

4.2.3.1.5. Two representatives from the Malaysian Investment Banking

Association (MIBA); and

4.2.3.1.6. One representative from non-bank participants (such as

Cagamas Bhd, Bursa Malaysia, Employee Provident Fund, and

Kumpulan Wang Persaraan Diperbadankan).

4.2.4. Nomination of Membership

4.2.4.1. Members are appointed by the respective banking associations, except for

representatives of non-bank participants, which shall be rotated amongst

all non-bank participants on a two-yearly basis.

4.2.5. Chairperson and Secretariat

4.2.5.1. PayNet will chair the RWC.

4.2.5.2. PayNet shall act as the Secretariat of the RWC.

4.2.5.3. The Secretariat role entails:

4.2.5.3.1. To manage committee meeting logistics;

4.2.5.3.2. Record and prepare minutes of meeting;

4.2.5.3.3. Disseminate meeting agenda and relevant documents to the

members of the committee 3-5 days in advance of the

meeting; and

4.2.5.3.4. Acting as custodian of committee’s documentation.

4.2.6. Frequency of RWC Meetings and Quorum

4.2.6.1. Meetings shall be held on a need-to meet basis as determined by the

Chairperson.

4.2.6.2. The quorum of the meeting shall be two thirds (2/3) of the members of the

RWC.



4.2.7. Responsibility of Committee Members

4.2.7.1. Attend RWC meetings;

4.2.7.2. Act as representatives of their organizations, ensuring that all stakeholders

within their organizations are consulted and kept informed regarding

RENTAS, FAST and eSPICK activities, initiatives and developments;

4.2.7.3. Circulate updates provided by PayNet to all relevant parties within their

organisation;

4.2.7.4. Formulate and articulate their organizations’ position and stance on any

developments, proposed amendments and/or issuance to the RENTAS,

FAST and/or eSPICK rules and operational procedures by obtaining and

integrating views of all relevant parties within their organisation;

4.2.7.5. Provide feedback to any proposed amendments to the existing rules and

procedures and/or the issuance of new rules for RENTAS, FAST and/or

eSPICK;

4.2.7.6. Propose amendments to the existing RENTAS, FAST and/or eSPICK rules

and operational procedures;

4.2.7.7. Co-ordinate and ensure timely implementation of RENTAS, FAST and/or

eSPICK initiatives at their respective organizations; and

4.2.7.8. Highlight, discuss, resolve and/or facilitate any other matters or issues in

relation to the rules referred to the RWC, the participants or other related

parties.



5.0 Users of the Systems

5.1. Issuer

5.1.1. Issuers are corporate or sovereign entities that have obtained Securities Commission

of Malaysia’s approval to raise funds through issuance of Debt Securities.

5.1.2. Issuers shall determine the mode of issuance (Tender or Private Placement) for the

Debt Securities and decide on the results of the Tender.

5.2. Facility Agent

5.2.1. Facility Agents (FAs) are licensed investment banks, commercial banks and Islamic

banks and other institutions approved by Regulatory Authorities that co-ordinate the

issuance of Debt Securities through FAST and manage debt facilities including advising

Issuers pertaining to issuance, corporate action, redemption of such Debt Securities.

5.2.2. For Specified RENTAS Securities, the FA is BNM. For Corporate Bonds and Sukuk, only

licensed investment banks, commercial banks and Islamic banks and other institutions

that are approved by Regulatory Authorities to co-ordinate the issuance of Debt

Securities through FAST are eligible to act as FAs.

5.2.3. There could be multiple co-arrangers for a Debt Facility. However, each Debt Facility

in FAST can only be maintained by one FA. That FA shall be the party to sign the

Securities Lodgement Form as required under Central Securities Depository and

Paying Agency Rules (CSDPAR).

5.2.4. The broad roles and responsibilities of FAs are summarised as follows:

5.2.4.1. Ensure that the Securities Lodgement Form as required under CSDPAR has

been duly executed by Issuers, Trustee (if applicable) and FAs.

5.2.4.2. Ensure the accuracy of Debt Facility and Debt Securities information in

FAST at all times and to update on a timely basis should there be any

changes to the information.



5.2.4.3. Update Coupon rate and Final Redemption Price at least one (1) Business

day before the respective Coupon and Final Redemption payment date.

5.2.4.4. Not allowed to change or amend critical information pertaining to the Debt

Securities (as defined in Guideline I) once the stock code has been

generated. As such, for any changes to this critical information, the FA

must make a written request to PayNet, at least two (2) Business days

before the corporate action date. PayNet reserves the right to decline a

request to amend if such changes impact information consistency,

accuracy or integrity in RENTAS.

5.2.4.5. Submit Global Certificates for New Issuances of Debt Securities and to

replace the Global Certificates arising from Partial Redemptions, Re-

openings or Maturity Extensions.

5.2.4.6. Collect the proceeds for Coupon Payment, as well as for Early, Partial and

Final Redemption from Issuers and remit the proceeds to Paying Agent

before the cut-off time.

5.2.4.7. Key-in the details of Early and Partial Redemption in FAST at least by the

time specified in Clause 7.2.8 and announce Redemptions in FAST

accordingly.

5.2.4.8. Immediately notify PayNet in writing in the event of default, or potential

delay in payments, by Issuers in relation to their financial obligations on

debt securities and immediately make the necessary announcements in

FAST.

5.2.4.9. Obtain bondholder information to facilitate administration of the

securities.

5.2.4.10. Participants must submit completed Bondholder Information Request

Form provided in Appendix X duly signed by at least two authorised

signatories to obtain stockholding information necessary for the

administration of securities under the FA’s purview. FAs shall ensure that

any information obtained is:



• For the specific purpose of administering the securities in their

capacity as FAs.

• Safeguarded in accordance with the Financial Services Act 2013 and

other applicable laws.

5.2.4.11. To access bondholder information as FAs or arrangers for debt securities

issuance, Participants must nominate a minimum of three (3) officers who

are authorised to:

• Request information on your organization’s behalf.

• Make changes to your organization’s authorised signatories.

• Request changes to your organization’s access to FAST.

Nomination shall be made by submitting the “Authorised Signatories”

form in Appendix XI to PayNet. Participants shall ensure that the list of

authorised officers lodged with PayNet is kept up to-date.

5.3. Tender Panel Member

5.3.1. Tender Panel Members are eligible investors that bid in the primary issuances of

Corporate Bond and/or Sukuk (CBS). Tender Panel Members must honour their Bids

if their Bids are within the successful range of the Tender and must agree with the FA

on the payment arrangement on the Settlement date.

5.4. Underwriter

5.4.1. Underwriter refers to the eligible institutions which undertake to take up under-

subscribed amounts of an Issue when the underwritten yield is lower than the bidding

yield, or when the underwritten price is higher than the bidding yield.

5.5. Rating Agency

5.5.1. Rating Agencies are entities which are recognised by the Securities Commission of

Malaysia for purposes of assessing and assigning credit ratings for Securities on an

independent and objective basis.

5.5.2. In relation to these Operational Procedures, Rating Agencies update rating for Debt

Facilities, Debt Securities and organisation in FAST.



5.6. Principal Dealer

5.6.1. Principal Dealers and Islamic Principal Dealers underwrite the issuance of Specified

RENTAS Securities that are sold in the primary market on a Tender Basis via FAST.

5.6.2. Principal Dealers are appointed by BNM for a specific period. They must perform

certain roles and obligations in relation to Specified RENTAS Securities in the primary

and secondary market.

5.6.3. The obligations of Principal Dealers in the secondary market include ensuring

sufficient liquidity for the Specified RENTAS Securities by always providing two-way

quotes.

5.7. Indicative Yield-to-Maturity (YTM) Contributors

5.7.1. All indicative YTM contributors appointed by BNM are required to submit quotations

for the Indicative YTM for Specified RENTAS Securities through FAST on a daily basis.

5.7.2. The appointed indicative YTM contributors in Clause 5.7.1 are also required to submit

quotations on a weekly basis (on every 7th, 14th, 21st and end-of-the month) for the

Indicative YTM of Corporate Bonds and Sukuk.

5.7.3. All Indicative YTM submissions for both Malaysian Government Securities and

Corporate Bonds and Sukuk must be made no later than 4:30pm. This requirement

must be strictly observed to enable the publication of the consolidated rate by

5:00pm.

5.7.4. For submission of indicative YTM for Corporate Bonds and Sukuk, if any of the

designated submission day falls on a non-Business day, submission must be made on

the preceding Business day. In the case where a public holiday is declared at the

eleventh hour, submission must be made on the next Business day.

5.8. SSDS Participants

5.8.1. SSDS Participants consist of:

5.8.1.1. RENTAS Participants that are permitted to hold Debt Securities for their

own accounts only; and



5.8.1.2. RENTAS Participants acting as Authorised Depository Institutions, who are

permitted to hold Debt Securities for their own accounts and on behalf of

their customers.

5.8.2. SSDS Participants who are permitted to hold Securities on behalf of customers are

required to perform the following obligations:

5.8.2.1. To maintain separate Segregated Securities Accounts (SSA) in RENTAS for

the Participants Securities and for Debt Securities held on behalf of the

SSDS Participants' resident and non-resident customers. The requirements

and guideline on opening the SSA in RENTAS are stipulated in the Guideline

V of the Operational Procedures for Malaysian Ringgit Settlement in

RENTAS. Upon opening of the SSA in RENTAS, SSDS Participants shall refer

to the “RENTAS SSA User Guide in FAST”, which is available under the Rules

and Guidelines section on the FAST website, for details of set-up and

application of SSA in FAST.

5.8.2.2. To maintain the details of every customers’ accounts in the SSDS

Participants’ internal records for Securities holding under the SSA.

5.8.2.3. To employ accounting practices and safekeeping procedures that fully

safeguards the customers’ Securities from claims from the SSDS

Participants' creditors.

5.8.2.4. SSDS Participants are prohibited from using the Debt Securities belonging

to their customers for any purpose without prior written approval of the

customers.

5.8.2.5. SSDS Participants shall grant their customers the right to the return of the

relevant quantity of Securities in the event of an insolvency or bankruptcy

of the SSDS Participants, so that each customer has enforceable

proprietary rights for the return of the relevant quantity of Securities

rather than the mere contractual rights of an unsecured creditor.



5.8.2.6. To conduct regular reconciliation to ensure correctness of the Securities

holding in custody in the SSDS Participants' internal records with the

aggregated holdings in RENTAS.

5.8.2.7. To issue monthly statements to each customer in respect of their holdings

of Debt Securities.

5.8.2.8. Pay to the customer Coupon/Interest/Dividend/Profit payment and

redemptions proceeds before the MYR Settlement Cut-off for MYR bonds

or Foreign Currency Settlement Cut-off for foreign currency bonds on the

Business day that proceeds are received from the issuers provided clear

and complete instructions have been received from customer.

5.8.2.9. Should Coupon Payment be subjected to Withholding Tax, SSDS

Participants are required to submit via FAST the details of all non-resident

beneficial holders under their custody no later than 1:00pm on Coupon

Payment Date.

5.8.2.10. SSDS Participants shall ensure that any disclosure of customer information

is carried out in accordance with Malaysia law. SSDS Participants hereby

authorise PayNet to release securities information pertaining to SSDS

Participants to Trustees and FAs to facilitate administration of the

Securities.

5.8.2.11. Notwithstanding Clause 5.8.2.1, BNM or PayNet may direct SSDS

Participants to maintain the segregated customer accounts in RENTAS for

each beneficial holder of securities.

5.9. Central Securities Depository

5.9.1. RENTAS is a CSD set up to ensure the orderly processing of Debt Securities deposited

in it. As such, RENTAS provides all the necessary facilities as follows:

5.9.1.1. To facilitate efficient depository of Debt Securities.



5.9.1.2. To facilitate the registration of Debt Securities as a result of trade

transactions involving the deposited Debt Securities.

5.9.1.3. To ensure the safe custody of Global Certificates and other documents

representing the deposited Securities.

5.9.1.4. To establish a proper and efficient system for the verification, inspection,

identification and recording of all Debt Securities deposited with the CSD.



6.0 Security of the Systems

6.1. FAST, eSSDS and RENTAS have comprehensive security features to ensure the authenticity,

integrity and confidentiality of the information. The security features are summarised as

follows:

6.1.1. A secure network to safeguard against unauthorised access through the use of

appropriate security software, hardware and firewall.

6.1.2. The use of Public Key Infrastructure (PKI) to authenticate, digitally sign and encrypt

transmission of critical information for tasks as listed in Guideline I.

6.1.3. Audit trails.

6.1.4. System functions that enforce segregation of duties with multiple level of approvals.

6.2. Each Participant is required to maintain minimum two (2) FAST Administrators at all times.

The FAST Administrators shall manage all user IDs (including FAST Administrators) within their

organization in accordance with the respective Participants’ internal IT security policies as well

as Bank Negara Malaysia’s guidelines and policies. Any appointment of additional FAST

Administrators can be executed by the appointed FAST Administrators.

6.3. Participants’ FAST Administrators shall ensure that access is granted on a need-to basis and

access should be reviewed periodically to determine if currently assigned access privileges are

appropriate. Participant’s FAST Administrators shall promptly revoke User IDs for officers who

have resigned, transferred, or whose job functions no longer require access to FAST (including

FAST Administrators).

6.4. If a Participant fails to maintain the minimum number of FAST Administrators, the Participant

shall promptly make a request to PayNet to appoint new FAST Administrators by completing

the “External User Access Request Form” in Appendix VIII to ensure the minimum number of

FAST Administrators is achieved.



7.0 Administrative Cut-Off Times

7.1. FAST is a web-based system and accessible on a 24-hour basis. Therefore, there is no system

cut-off time for general administrative tasks such as updating information of Debt Facilities,

Debt Securities, creating new users, etc.

7.2. Notwithstanding Clause 7.1, the following deadlines must be observed:

No Action Time Deadline

1 Creation of Debt Facilities and

New Issuances in FAST

N/A For Specified RENTAS

Securities:

• Issued by Gov and BNM

❖ At least two (2) Business

days before the Issue

date

For Non-Specified RENTAS

Securities:

• At least two (2) Business days

before the Issue date

2 Tender Invitations for Specified

RENTAS Securities

N/A For Specified RENTAS

Securities:

• Issued by Gov and BNM

❖ At least two (2) Business

days before the Issue

date

3 Tender Invitations for CBS N/A At least two (2) Business days

before the Securities Issue date

4 Submission of Bids 11:30am Tender Closing Date, unless

specified otherwise

5 Confirmation of Allotments, either

via Tenders or Private Placements

3:00pm One (1) Business day before the

Securities Issue date

6 Tender Abortions and / or Stock

Abortions, if any

3:00pm One (1) Business day before the

Securities Issue date

7 Update on the floating / step-up 3:00pm One (1) Business day before




interest rates information and

Final Redemption Price

Coupon Payment Date and

Redemption Date

8 Submission of Early Redemptions

or Partial Redemptions

3:00pm Two (2) Business days before

Redemption Date

9 a. Settlement of Allotments by

subscribers for MYR and

Foreign Currencies Securities

On-shore

11:30am

On Securities Issue date

b. Settlement of Allotments by

subscribers for USD Securities

via USD CHATS

11:30am On Securities Issue date

10 a. Settlement of Coupon

proceeds for MYR and Foreign

Currencies Securities On-

shore:

i. From Issuers to FAs 11:00am On Coupon Payment Date

ii. From FAs to Paying

Agent

12:00noon

iii. From Paying Agent to

securities holders

12:30pm

b. Settlement of Coupon

proceeds for USD Securities

via USD CHATS:

i. From Issuers to FAs 10:00am On Coupon Payment Date


Agent

12:00noon


securities holders

4:00pm

11 a. Settlements of Early, Partial

and Final Redemptions

proceeds for MYR and Foreign

Currencies Securities On-




shore:

i. From Issuers to FAs 11:00am On Early, Partial and Final


Agent

12:00noon Redemption Date


securities holders

12:30pm

b. Settlements of Early, Partial

and Final Redemptions

proceeds for USD Securities

via USD CHATS:

i. From Issuers to FAs 10:00am On Early, Partial and Final


Agent

12:00noon Redemption Date


securities holders

4:00pm

12 Submission of New/ Replacement

Global Certificate for the following

events:

a. New Issue 3.00pm On the Securities Issue Date

b. New Issue, which requires

amendment in Global

Certificate under following

circumstances:

i. Upsize/Downsize

ii. Coupon rate or

Secondary Notes is

based on the

weighted average of

successful Bids

3.00pm Two (2) Business days after the

Securities Issue Date

c. Partial Redemption,

Reopening or Extension of

Maturity Date

3.00pm Two (2) Business days after the

Event Date



7.3. For issuance of US Dollar (USD) Securities deposited in RENTAS and settled in USD CHATS, the

following cut-off times for Settlement shall be observed:

7.3.1. Allotment

7.3.1.1. All successful subscribers are required to settle the USD Allotment

proceeds through payments to FA’s accounts with the FA’s appointed

banker in Hong Kong by the time specified in Clause 7.2.9 (b) on the

Securities Issue date.

7.3.1.2. FAs shall remit the USD Allotment proceeds to Issuers’ banker by 4:00pm

on the Securities Issue date.

7.3.2. Coupon / Redemption Payment

7.3.2.1. Issuer shall pay Coupon / Redemption proceeds to FA’s accounts, in

accordance with Clause 7.2.10 (b)(i) on Coupon / Redemption payment

date.

7.3.2.2. FAs shall remit Coupon / Redemption proceeds into PayNet’s account at

PayNet’s appointed banker in Hong Kong by the time specified in Clause

7.2.10 (b)(ii) for coupon payment and Clause 7.2.11 (b)(ii) for

redemption payments.

7.3.2.3. PayNet shall pay to SSDS Participants’ accounts at their appointed

bankers in Hong Kong by the time specified in Clause 7.2.10 (b)(iii) /

Clause 7.2.11 (b)(iii) on Coupon / Redemption payment date, subject to

receiving the prior payment from FAs.

7.4. PayNet may, from time to time, vary any of the above administrative or system cut-off times.

Any such variation will be notified to Participants seven (7) Business days before the changes

come into effect.



ISSUING PROCEDURES FOR MULTICURRENCY SPECIFIED RENTAS SECURITIES SETTLED ON-SHORE

8.0 General

8.1. This part outlines the procedures for the Issuance of Specified RENTAS Securities issued by

Government and BNM through Principal Dealers.

8.2. Specified RENTAS Securities issued by the Government and Bank Negara Malaysia ( with the

exception of BNM Sukuk) are dematerialized and deposited in RENTAS.

8.3. BNM Sukuk with global certificates representing the issuance lodged with PayNet are

immobilised and deposited in RENTAS.

8.4. Allotment for Specified RENTAS Securities either through Tender or Private Placement must

be completed by 3:00pm, one (1) Business day before the Securities Issue date.

8.5. For New Issuances via Tender, the Tender Invitation must be issued at least two (2) Business

days before the Securities Issue date.

8.6. Should there be any changes to the Securities Issue date, size, subscribers / SSDS Participants

and their respective Allotment amounts, FAs are required to notify PayNet by 3:00pm, one (1)

Business day before the Securities Issue date.

8.7. Any Tender Abortion or Stock Abortion must be completed by 3:00pm, one (1) Business day

before the Securities Issue date.



9.0 Issuer Creation and Maintenance

9.1. If Issuer’s information is already in FAST, FAs needs to verify the information and update if

necessary. FAs can change Issuers description, Issuer code and business registration number

using the Organisation Maintenance Screen in FAST. However, it is advisable to use the

existing Issuer code unless there is an official change in Issuers name.

9.2. For new Issuers, FAs must create Issuers profile under the “Organisation Maintenance” screen

in FAST. FAs shall ensure that all the details are accurate, especially Issuers name, business

registration number and business sector.



10.0 Debt Facilities Creation and Maintenance

10.1. FAs are responsible to create Debt Facilities in FAST. FAs shall ensure the accuracy of Debt

Facilities information at all times and shall update on a timely basis should there be any

changes to Debt Facilities information.

10.2. Debt Facilities may be cancelled prior to the maturity date, provided all Debt Securities issued

under that Debt Facilities have been fully redeemed without any outstanding balances.



11.0 New Issuances Creation and Maintenance

11.1. New Issuances refers to the registration of new issues of Specified RENTAS Securities. FAs are

required to key-in into FAST all the relevant information pertaining to the Specified RENTAS

Securities.

11.2. Once the New Issuances are approved, FAST will generate a unique Stock Code and

International Securities Identification Number (ISIN) for each Debt Securities.

11.3. The New Issuances shall be completed at least two (2) Business days before the Securities

Issue date.

11.4. Should there be a need for the approved New Issuances to be aborted, it must be done in

FAST by 3:00pm, one (1) Business day before the Securities Issue date.



12.0 Re-opening of Debt Securities

12.1. Re-opening is defined as an increase in the Issue size of the existing Debt Securities while

maintaining the same characteristics of the existing one (i.e. Coupon Payment Date, Coupon

rate, maturity date, etc).

12.2. Re-opening increases the Issue size of Debt Securities, and thus adding more liquidity in the

secondary trading.

12.3. The Specified RENTAS Securities can be re-opened at any date before its maturity. There is no

limitation on the number of times that the same Specified RENTAS Securities can be re-

opened. The creation of Re-opening for Specified RENTAS Securities shall be completed in

FAST at least two (2) Business days before the Re-opening date.

12.4. Re-opening of existing Specified RENTAS Securities can be conducted via Tender or Private

Placement. Allotment either via Tender or Private Placement shall be completed in FAST by

3:00pm, one (1) Business day before the Re-opening date.

12.5. The cash proceeds for the Re-opening Allotment will include the accrued interest from the

last Coupon Payment Date until the Re-opening date.

12.6. For Fixed Rate Specified RENTAS Securities, the Tender Basis for Re-opening can either be on

yield or Price.

12.7. Should there be a need for the Re-opening to be aborted, it must be done in FAST by 3:00pm,

one (1) Business day before the Re-opening date.



13.0 Mode of Offer

13.1. Issuance of Specified RENTAS Securities in FAST (new or Re-opening issues) can be made either

via Tender or Private Placement.

13.2. Private Placement refers to issuance through bought deal by the primary subscribers, direct

placement to several investors, book building by the appointed agent or any other method as

agreed by the parties involved.



14.0 Private Placement Procedure

14.1. FAs are required to input the Private Placement Allotment information in FAST. Private

Placement Allotment must be completed by 3:00pm, one (1) Business day before the

Securities Issue date. Allotment details in FAST are only visible to FAs and the Private

Placement subscribers.

14.2. Once the Private Placement Allotment has been approved, it cannot be cancelled or amended.

If there is an error after the Private Placement Allotment has been approved, Debt Securities

and the corresponding Private Placement Allotment will have to be aborted.



15.0 Tender Procedure – Tender Invitation

15.1. FAs may create a Tender Invitation template by configuring the relevant characteristics of

Tender (e.g.: Tender Basis and Proceeds Formula). The template can be re-used for future

Tenders and thus minimise any potential error.

15.2. For new Tenders, FAs are required to input Tender details such as Tender Opening Date,

Closing Date and Time, Tender Basis and Direct Bidders for the Tender. Tender Invitations

must be announced at least two (2) Business days before the Securities Issue date.

15.3. Any changes to the Tender Invitation must be done before the Tender closing time. FAs shall

ensure that all the involved parties are informed of such amendments. Once the Tender

Invitation is confirmed, it will be listed in the Forthcoming Tender in FAST where the

information is accessible to all FAST Participants as well as the public.

15.4. FAs are required to update the latest list of Principal Dealers in Debt Facilities in FAST before

approving Tender Invitations, failing which, the omitted Principal Dealer will not be able to

participate in the Tender.

15.5. The Tender Invitation may be aborted before the Securities Issue date. The aborted Tender

Invitation will be announced via FAST.



16.0 Tender Procedure – Submission of Bids

16.1. Principal Dealers shall submit Bids between the Tender Opening Date and the Tender Closing

Time. Any Bids submitted after the Tender Closing Time will be rejected by FAST.

16.2. As the Submission of Bids can only be done by the Principal Dealers, any other interested

investors will have to submit their Bids through the Principal Dealers.

16.3. All Bids submitted by Principal Dealers must be in multiples of RM1 million, failing which, the

Bids will be rejected by FAST. Authorised officers of the Principal Dealers must app