KUALA LUMPUR (Oct 7): NewParadigm Securities has completed its first RM231 million bond issuance under TY Consolidated Capital Bhd’s RM500 million programme, marking Asia’s first pawn-loan backed securitisation as gold prices reach record highs.
The first tranche of senior notes, rated AAA/Stable by RAM Rating Services Bhd, is backed by pawn-loan receivables originated by Ta Yoong Sdn Bhd — a second-generation family business with over 70 years in the pawnbroking industry — and its subsidiaries, according to a statement.
TY Consolidated was established as a special-purpose vehicle to facilitate the securitisation of pawn loans.
The transaction comes as gold prices surged 50% this year to fresh record highs, amid geopolitical and trade tensions, as well as expectations of monetary policy easing by the US Federal Reserve, which lifted demand for the non-yielding asset. On Tuesday, the commodity was trading at around US$3,959.50 (about RM16,685.83) per ounce after touching another fresh record.
“This transaction is a breakthrough for Malaysia’s capital markets and sets the foundation for a new asset class in Asia,” said NewParadigm Securities group chief executive officer Charanjeev Singh. “By combining pawn loans collateralised by gold with a securitisation framework, we have created a resilient structure that balances investor protection with funding efficiency for Ta Yoong and its subsidiaries.”
Ta Yoong Group chief executive officer Datuk Ho Teck Keun said the issuance reflects the group’s efforts to unlock alternative financing channels and improve capital efficiency through securitisation.
He added that the strong market response highlights both the resilience of the structure and investor confidence in Ta Yoong and its partners.
Proceeds from the bond issuance will primarily support the expansion of Ta Yoong’s pawn-loan financing business, strengthening its ability to provide accessible micro-financing solutions to communities.