Question

Ramadhan Islamic Bank is being offered a Sanadat Mudharabah Cagamas (SMC)
with a face value of RM50 million.

Below are the details of the SMC:
• Issuance date: August 10, 2015
• Maturity date: August 10, 2017
• Transaction Date: December 23, 2015
• Next Coupon Payment: August 10, 2016
• Indicate Coupon: 7.5 % (annual coupon)
• Yield to Maturity: 10 %

Calculate the appropriate Value for the SMC (per RM100 face value)

Answer 1

Transaction date	23.12.2015
Next coupon date	10.08.2016
Number of days count	231
Coupon rate(Per annum)	7.50%
First year Coupon Amount	2.37
(50 Million*7.5%*231/365)
Second year Coupon Amount	3.75
(50 Million*7.5%)
Maturity value at the end of Year 2	50 Million
Yield to Maturity	10%
Value of SMC = Present value of( coupon Amounts year 1,2 and Maturity value)

  

Year	Particulars	Cashflows	YTM @ 10%	Amount(MM)
1	Coupon	2.37	0.909	2.16
2	Coupon	3.75	0.826	3.10
2	Maturity value	50	0.826	41.32
	SMC value (in Millions)			46.58
	SMC value ( per 100 Face value)			46579