Malaysian Rating Corporation Berhad (MARC) held its 21st Annual General Meeting (AGM) at Sime Darby Convention Centre on June 15, 2017.
“MARC had delivered a satisfactory financial performance for 2016 in spite of a backdrop of lower rated bond and sukuk issuance,” said MARC Chairman Datuk Azizan Haji Abd Rahman in his review of the company’s results for the financial year ended December 31, 2016. Building on its consistent and sustainable performance in previous years, the company posted a consolidated pre-tax profit of RM4.6 million in 2016 (2015: RM5.5 million) on the back of total revenue of RM16.2 million (2015: RM17.2 million).
Datuk Azizan expressed confidence that MARC’s existing rating universe and defensible franchise in project finance and corporate debt ratings would continue to provide a reasonable measure of business resilience despite prevailing global headwinds. He added that MARC had plans to diversify its business and revenue base in light of the slowing pace of domestic corporate bond issuances since 2013. The smaller volume and number of issuers rated by MARC in 2016 compared to the year before mirrored the decline in the proportion of aggregate rated issuances in domestic bond and sukuk markets. While this currently poses a challenge to the rating agency, MARC is also cognizant of the opportunities that exist in the dynamic and evolving domestic capital markets, as conveyed in the theme for MARC’s annual report for 2016 of Building Resilience, Embracing Opportunity. Furthermore, the uptick in corporate and project finance activity in the first quarter of 2017 signals a promising start of what could be an active pipeline of credit rating mandates for the agency.
Datuk Azizan also commented on the progress MARC had continued to make in improving its long-term rating accuracy performance. The very stable ratings performance of MARC’s rated universe, which saw four downgraded issuers experiencing no more than a two-notch downgrade, is suggestive of improved rating accuracy.
MARC had also received recognition of its commitment to be a valued capital market intermediary during 2016 from The Asset magazine at its annual Triple A Rating Agency of the Year Awards as “Malaysia’s Project Finance Rating Agency of the Year” and from Global Islamic Finance Awards (GIFA) as “Best Islamic Rating Agency 2016”.
The company’s shareholders adopted the financial statements and approved a final dividend of 12.5 sen per share for the financial year ended December 31, 2016 at the AGM.