Khazanah Nasional Berhad Issuer Summary

Date prepared: May 7, 2026
Issuer: Khazanah Nasional Berhad
Country / classification: Malaysia / government-linked investment company and sovereign investment holding company
Main funding programmes: Khazanah Capital Ltd’s USD10bn EMTN programme and Khazanah Global Sukuk Berhad’s USD5bn sukuk issuance programme

1. Credit View and Monitoring Focus

Khazanah Nasional Berhad (“Khazanah”) should be assessed not as an ordinary operating company, but as a quasi-sovereign investment holding issuer with extremely strong links to the Malaysian government. The core of its credit strength lies in its ownership by the Minister of Finance (Incorporated), its policy importance as Malaysia’s sovereign wealth fund, its large investment asset base, and its continuing access to domestic and international capital markets.

At the same time, within the scope of the public materials reviewed for this report, I could not confirm that the Malaysian government provides an explicit guarantee for Khazanah’s own debt. Khazanah’s guarantee of debt issued by its subsidiary SPVs and a government guarantee of Khazanah are separate matters. Therefore, for investment purposes, the practical framing is that “government support expectations are very strong, but these are not fully sovereign-guaranteed bonds.”

Current financial metrics are sound. On February 10, 2026, Khazanah announced that for 2025 it had net assets of RM105bn, total assets of RM156bn, operating profit of RM5.6bn, a one-year return of 5.2%, and a seven-year rolling annualised return of 6.1%. For 2024, it disclosed NAV of RM103.6bn, NAV TWRR of 24.6%, operating profit of RM5.1bn, and RAV / debt of 3.2x. As an investment holding company, mark-to-market volatility is unavoidable, but at present asset coverage and capital-market access support its credit profile.

For bond investors, the most important issue is not short-term operating cash flow. The relevant points to monitor are how far asset value can be maintained, whether leverage remains contained, whether liquidity and refinancing capacity are preserved, and whether policy-driven investments consume financial flexibility excessively. At present, Khazanah’s credit strength is supported by its strong government links and large asset base, and is assessed as clearly higher than that of an ordinary investment holding company.

2. Issuer overview

Khazanah is Malaysia’s sovereign wealth fund. It was established in September 1993 and commenced operations in 1994. According to official materials, it is owned by the Minister of Finance (Incorporated), except for one share held by the Federal Land Commissioner. In substance, it is the Malaysian government’s investment holding company.

The company manages a combination of domestic and overseas listed equities, private investments, strategic assets, emerging industries, and investments targeting socioeconomic impact. It is not simply an external asset manager, but an institution that pursues commercial returns and national development objectives at the same time. For this reason, credit analysis needs to focus more on asset value, funding capacity, the relationship with the government, and investment discipline than on the profitability of individual businesses.

Khazanah’s current strategy is centred on “Advancing Malaysia.” From an investment perspective, the three important angles are its role as a core player in the domestic capital market, Dana Impak as a vehicle targeting social impact, and a diversified portfolio including overseas investments. This framework increases its policy importance, while also implying an increase in investments that cannot be measured purely by short-term earnings.

3. Government links and support expectations

Khazanah’s strongest source of credit support is its close relationship with the Malaysian government. The main facts that can be confirmed are as follows.

In the rating announcement on April 27, 2023, Moody’s and S&P assigned Khazanah ratings of A3 / A-. The rating rationale cited its strong links with the government, ownership of domestic strategic assets, and role in implementing socioeconomic policy. This confirms that Khazanah is an issuer closely tied to Malaysia’s credit profile.

However, support expectations and legal guarantees need to be considered separately. Based on public materials, an explicit Malaysian government guarantee for Khazanah’s debt has not been confirmed. It would therefore be excessive to treat Khazanah bonds as equivalent to Malaysian government bonds. In investment analysis, it is necessary to give credit to strong implicit support while also checking Khazanah’s own leverage, liquidity, and room for asset sales.

4. Portfolio and asset base

Khazanah has a large asset base, but disclosure is mainly based on strategic classifications, and does not provide the full detailed asset-by-asset breakdown that bond investors would prefer. On the official website, investments are broadly classified into the following four categories.

For 2025, Khazanah explained that the Investments Portfolio expanded from RM81bn in 2018 to RM95bn at end-2025. This was driven by increases in domestic and overseas equities, asset-value enhancement initiatives, and diversified investments.

This asset base is Khazanah’s strength. Because it has a large investment portfolio, there is room to rotate or sell assets as needed. Its ownership of many domestic strategic assets is also a factor that increases government support expectations. On the other hand, the market value of the portfolio is affected by market conditions. If equity markets, foreign exchange, domestic policy, or the performance of investee companies deteriorate, NAV and RAV could decline.

5. Financial performance

5.1 2024 performance

According to the announcement released on February 5, 2025, the 2024 results were as follows.

RAV / debt of 3.2x is particularly important. It is not a substitute for a detailed debt maturity schedule or cash balance, but it indicates that the debt burden is contained to some extent relative to asset value.

5.2 2025 performance

According to the announcement released on February 10, 2026, the 2025 results were as follows.

The 2025 one-year return was lower than in 2024, but this appears to be within the natural range of volatility for an investment holding company. The simultaneous confirmation of higher operating profit, maintained net assets, and a higher dividend is instead positive.

6. Funding

Khazanah has a recurring issuance track record in domestic and international capital markets. Its official bonds page explains that the company diversifies funding sources and optimises its capital structure through sukuk and bond issuance. It also states that MTNs issued by SPVs are irrevocably and unconditionally guaranteed by Khazanah.

The main published programmes are as follows.

A recent representative foreign-currency issuance was the dual-tranche transaction on May 25, 2023. It consisted of a USD750mn five-year sukuk and a USD750mn 10-year conventional bond. The transaction attracted peak demand of USD12bn and was more than seven times oversubscribed. Even after allowing for favourable issuance conditions, this is evidence of Khazanah’s strong market access.

7. Ratings

The main Khazanah-specific ratings that can be confirmed were announced on April 27, 2023, as follows.

The official bonds page as of May 7, 2026 also shows A3 / A- for the foreign-currency programme bonds. In the public information reviewed for this report, no subsequent Khazanah-specific upgrade, downgrade, or outlook change could be confirmed.

This rating level is understood to reflect Khazanah’s strong links with the Malaysian government. However, Khazanah is an investment holding company, and portfolio value, leverage, liquidity, and investment discipline will remain important rating considerations.

8. Recent strategic transactions

8.1 Malaysia Airports Holdings Berhad

Khazanah has announced the completion of the privatisation of Malaysia Airports Holdings Berhad. This is an important transaction supporting the country’s airports and connectivity, and has scope for medium-term value creation. On the other hand, transformation execution requires capital investment and time, so from a credit perspective it is necessary to monitor progress and the capital burden.

8.2 Dana Impak and Jelawang Capital

Khazanah is expanding domestic catalytic investments. Jelawang Capital is positioned as a national fund-of-funds to develop the domestic fund ecosystem. Capital provision to mid-sized companies, semiconductors, and advanced manufacturing increases policy importance, while the period to investment recovery can easily become longer.

8.3 Dana Warisan

Dana Warisan is involved in the regeneration of heritage assets and the utilisation of tourism assets. It has national significance, but is not a main driver of short-term financial returns. From a credit perspective, the key point is how much capital becomes locked up over the long term.

8.4 Tokenised Sukuk

In April 2026, a tokenised sukuk pilot was announced. The direct balance-sheet impact is small, but it shows that Khazanah is also involved in the development of Malaysia’s capital markets.

9. Credit strengths

Khazanah’s first strength is the strength of its relationship with the government. Ownership by the Minister of Finance (Incorporated), a governance structure in which the Prime Minister and Minister of Finance serves as chairman, and an investment mandate aligned with national strategy are forms of credit support not available to ordinary investment holding companies. This is not merely a formal point that the government is the shareholder. Khazanah is also an implementation vehicle for policies related to Malaysia’s capital markets, airports, technology industries, tourism and cultural assets, and domestic enterprise development. Therefore, any credit issue at Khazanah would easily spill over into issues of reputation, policy, and market access for the government.

The second strength is the size of the asset base. Total assets of RM156bn and net assets of RM105bn in 2025 indicate that the company is not an issuer dependent on a single business, but a holding company with multiple assets, markets, and investment themes. The 2024 RAV / debt of 3.2x also indicates reasonably thick asset coverage against debt. Of course, because RAV depends on market valuation, it is not a fixed margin of safety, but at least the issuer does not have a fragile balance sheet that would immediately become unable to refinance.

The third strength is its repeated issuance record in capital markets. Khazanah uses both domestic ringgit programmes and foreign-currency programmes, and can issue both sukuk and conventional bonds. This means it can diversify its investor base, currencies, and product formats. The strong demand for the 2023 USD dual-tranche issuance shows that Khazanah’s name is accepted by international investors.

The fourth strength is that its policy importance is unlikely to decline over the long term. MAHB, Dana Impak, Jelawang Capital, Dana Warisan, and semiconductor and advanced manufacturing-related investments involving Khazanah are not areas whose importance disappears solely because of short-term economic cycles. Rather, the more the Malaysian government advances domestic industrial upgrading, capital-market development, and the utilisation of tourism and cultural assets, the more likely Khazanah’s role is to remain relevant.

10. Credit constraints

The largest constraint is the absence of an explicit guarantee. Khazanah is extremely close to the government, but in the public materials reviewed for this report, I could not confirm that the Malaysian government legally guarantees all of Khazanah’s debt. Therefore, when assessing government linkage, it should not be treated mechanically like sovereign-guaranteed debt; the likelihood of support, the incentives to provide support, and the timing of support need to be considered separately.

The second constraint is mark-to-market volatility as an investment holding company. Khazanah’s credit strength is supported by a large asset base, but the value of that asset base is affected by market conditions. If valuations of domestic equities, overseas equities, private investments, and strategic assets deteriorate at the same time, NAV and RAV would decline. Even if RAV / debt appears high, during market stress the denominator, debt, remains fixed while only the numerator, asset value, may shrink.

The third constraint is the profitability of policy-driven investments. Khazanah’s policy importance is a credit strength, but policy-driven investments do not necessarily maximise short-term financial returns. Dana Impak, Dana Warisan, domestic industry development, and support for semiconductors and advanced manufacturing target long-term economic impact, while capital recovery can easily take time. If these investments increase too much, apparent policy importance may rise, but asset liquidity and dividend capacity could weaken.

The fourth constraint is the limit of detailed disclosure. Public materials allow confirmation of total assets, net assets, profit, returns, RAV / debt, and similar metrics, but they do not provide sufficient detail on the items bond investors most want to see: cash balances, short-term debt, maturity distribution, outstanding foreign-currency debt, hedging policy, and unused committed facilities. Therefore, before making an actual investment, it is necessary to supplement public information with prospectuses, detailed annual reports, rating reports, and Bloomberg / Refinitiv bond data.

11. Perspective as an Investment Holding Company

When analysing Khazanah, focusing solely on operating-company EBITDA or operating margins is insufficient. Rather, as an investment holding company, the emphasis should be on the relationship between asset value and debt. Key considerations are which assets are held, how readily they can be monetised, the extent to which policy considerations limit disposals, and whether sufficient cash, saleable assets, and market access exist relative to debt maturities.

Credit strength for investment holding companies generally comprises three layers. The first layer is the quality of the assets themselves. Highly liquid listed equities, strategic assets generating dividends, growth-oriented private investments, and policy-driven long-term assets carry different credit value even if RAV is the same. The second layer is the size of debt relative to assets. A high RAV / debt ratio provides a buffer for debt repayment even if asset prices decline. The third layer is the issuer’s funding capacity. Issuers that can buy time through capital markets or bank borrowing before relying on asset sales have greater resilience under stress.

For Khazanah, all three layers are relatively strong. The asset base is large, RAV / debt was publicly reported at 3.2x as of 2024, and capital market access is confirmed domestically and internationally. However, some assets may be difficult to sell due to policy considerations. Therefore, it is conservative to treat the RAV as fully liquid. Investors should categorise asset quality into “listed and liquid,” “strategic assets with disposal constraints,” “long-term policy investments,” and “restructuring or challenged assets.”

From this perspective, Khazanah’s strength lies not in the asset size alone, but in the combination of assets, policy relevance, and market access. Even if asset values decline, market access provides time. Even if market access temporarily deteriorates, holding liquid assets offers flexibility. If both decline simultaneously, government support expectations can act as a funding backstop. This three-layered defence distinguishes Khazanah from a typical investment holding company.

12. Incorporating Government Support

Government support for Khazanah should be assessed as implicit, arising from policy importance and ownership structure, rather than as an explicit guarantee. When evaluating implicit support, it is necessary to separate three elements: the government’s capacity to support, the government’s willingness to support, and whether the support can reach bond investors in time.

First is capacity. Malaysia’s sovereign ratings—Moody’s A3, S&P A-, and Fitch BBB+—are investment grade. This provides some basis for the government’s ability to support. However, if the sovereign’s fiscal flexibility or rating outlook deteriorates, expectations of support for Khazanah would weaken.

Second is willingness. Khazanah is effectively owned by the Minister of Finance and is deeply involved in national strategy, suggesting the government is unlikely to allow a credit deterioration to go unaddressed. In particular, any impairment of Khazanah’s market access could affect perceptions of government-linked issuers, Malaysia’s capital market, and the sukuk market, which increases the incentive to provide support.

Third is form. Government support does not necessarily take the form of a debt guarantee. It could include capital injections, asset transfers, liquidity provision via policy institutions, adjustments to dividend policy, investment restructuring, or regulatory and institutional support. For bond investors, it is important not just whether support occurs, but whether it is implemented before maturity and directly improves issuer liquidity.

Therefore, when assessing Khazanah bonds, government support should be incorporated on a graduated basis rather than a binary present/absent approach. In normal conditions, government linkage suppresses spreads; under mild stress, it supports market access; and under severe stress, some form of support is expected. However, because there is no legal guarantee, investors should verify individual bond covenants, guarantee parties, SPV structures, maturities, currencies, and liquidity.

13. Understanding the Funding Programmes

Khazanah’s funding is divided across multiple SPVs and programmes. While more complex than a simple single-issuer bond, this is advantageous for diversifying issuance markets, currencies, and investor bases. In ringgit, it issues through Danga Capital, Danum Capital, Rantau Abang Capital, and Ihsan Sukuk using Islamic financing structures. In foreign currencies, Khazanah Capital Ltd and Khazanah Global Sukuk Berhad are the main issuers.

The first point for bond investors to confirm is the relationship between the issuer and guarantee party. The official bonds page states that SPV-issued MTNs are guaranteed by Khazanah, but for each bond, investors should verify the wording, scope, governing law, and payment priority. Particularly in sukuk, legal form and economic substance can differ, so investors should review the payment mechanics rather than simply treating all issues as “Khazanah-related.”

The second point is currency and maturity. The 2023 USD issuance included a five-year sukuk and a ten-year conventional bond. The five-year bond has a shorter refinancing cycle and is exposed earlier to interest rate and market conditions. The ten-year bond has longer duration and is more sensitive to sovereign spreads, U.S. rates, and Malaysia-related premiums. Investment analysis should differentiate risk tolerance by maturity even for bonds from the same issuer.

The third point is liquidity. Strong demand for large issuances is positive, but investors should verify whether there are sufficient bids in the secondary market and compare spreads with similarly rated Malaysian sovereigns, Petronas, major banks, and other government-related issuers. Even if Khazanah credit risk is low, thin market liquidity can increase position adjustment costs.

14. Recent Strategic Transactions

14.1 Malaysia Airports Holdings Berhad

Khazanah has announced the completion of the privatisation of Malaysia Airports Holdings Berhad. This is a key transaction supporting the country’s airports and connectivity, with scope for medium-term value creation. However, implementing transformation requires capital investment and time, so progress and capital burden must be monitored from a credit perspective.

Airport assets are highly policy-sensitive for Malaysia, affecting tourism, logistics, foreign investment, and domestic mobility, and are likely to remain a long-term government priority. For Khazanah, this is positioned not merely as a financial investment but as a national infrastructure value-enhancement project. However, airport operations are affected by capital expenditure, passenger demand, tariff regulation, airline finances, and tourism policy. If post-privatisation value creation is slower than expected, investment recovery periods could be extended.

14.2 Dana Impak and Jelawang Capital

Dana Impak is a social-impact investment vehicle, and Jelawang Capital is positioned as a national fund-of-funds to develop the domestic fund ecosystem. These enhance Khazanah’s policy importance, while also adding uncertainty regarding investment payback periods and profitability.

Capital provision to mid-sized companies, semiconductors, advanced manufacturing, and startups may support Malaysia’s industrial upgrading. However, such investments cannot necessarily be sold immediately like large listed equities. They are dependent on investee growth, exit markets, additional funding needs, and alignment with government policy. From a credit perspective, the critical issue is not the investment amount itself, but the extent to which additional commitments increase and whether commercial portfolio earnings can sufficiently absorb them.

14.3 Dana Warisan

Dana Warisan is involved in heritage asset regeneration and tourism asset utilisation. While of national significance, it is not a main driver of short-term financial returns. Credit analysis requires separating policy value from financial value.

Such assets are not readily monetisable. Therefore, even if they have value in RAV, they should be discounted as a source of liquidity for debt repayment. Conversely, if investment in Dana Warisan is limited and does not undermine the earnings of the core commercial portfolio, credit impact is limited.

14.4 Tokenised Sukuk

The April 2026 tokenised sukuk pilot has a small direct balance-sheet impact. However, it signals Khazanah’s role in developing Malaysia’s capital markets. While such initiatives do not boost short-term credit, they reinforce its position as a government-linked issuer.

15. Downside Scenarios

The first risk is a decline in portfolio value. If domestic strategic assets, listed equities, and overseas investments fall simultaneously, NAV and RAV decline, weakening asset coverage. Even with high RAV / debt, under stress asset values may drop sharply while debt remains at par. Therefore, both the level and downside resilience of RAV / debt should be assessed.

The second risk is deterioration in refinancing conditions. While Khazanah has strong capital market access, instability in foreign-currency bond or sukuk markets can increase funding costs and constrain issuance timing. In particular, simultaneous rises in U.S. rates, widening Malaysian sovereign spreads, and emerging-market outflows can worsen terms even for similarly rated A-range issuers.

The third risk is a higher share of policy-driven investments. An excessive increase in long-term, low-return national projects can raise policy importance but reduce financial efficiency and liquidity. This may be less apparent in the short term, but over several years could affect dividend capacity, asset disposability, and investment returns.

The fourth risk is a weakening of Malaysian sovereign credit or policy execution. Khazanah’s credit strength heavily depends on government linkage, so changes in sovereign ratings or policy consistency could affect its spreads and ratings. Fiscal deficits, political instability, policy shifts, or government-linked company restructuring are key considerations.

The fifth risk is restrictions on asset sales. Some of Khazanah’s assets are strategically important, so even if theoretically sellable, they may be difficult to divest in practice. Investors should consider not just total assets but also saleable assets, dividend-generating assets, and policy-locked assets.

16. Monitoring Indicators

Khazanah bonds should not be treated as Malaysian sovereigns, but as “quasi-sovereign issuers where financial discipline as an investment holding company also matters.” Key monitoring items are:

Prior to investment, particularly monitor foreign-currency bond prices and spreads. While Khazanah credit strength is robust, investment attractiveness depends on spreads. Compare with Malaysian sovereigns, Petronas, major banks, and other government-linked issuers to assess incremental yield. Minimal incremental yield may favour more liquid sovereigns or large government-related bonds, while adequate premium relative to government linkage and asset base supports relative value.

17. Relative Value Considerations

Khazanah’s relative value cannot be judged solely on rating comparison. While the A3 / A- rating indicates a high-quality issuer, actual bond appeal depends on spreads versus Malaysian sovereigns, large government-related issuers like Petronas, and similarly tenured quasi-sovereigns in Asia.

If trading at spreads close to the Malaysian sovereign, investors should consider whether the lack of explicit guarantee is sufficiently compensated. Khazanah has strong government linkage but is not sovereign. Therefore, at identical yields, sovereigns may be preferable due to liquidity and clarity of guarantee.

Conversely, it is reasonable for Khazanah to trade tighter than ordinary corporates or investment holding companies of similar rating. Considering government linkage, policy importance, asset base, and market access, requiring the same spread as a standard holding company may be overly conservative. Relative value for Khazanah is naturally judged on a scale “wider than sovereigns but tighter than ordinary investment holding companies.”

Views also differ by maturity. For short- and medium-term bonds, liquidity and refinancing capacity are the main considerations. Given Khazanah’s market access and government links, credit risk is relatively contained in the short to medium term. For long-term bonds, portfolio value, policy investments, sovereign ratings, and interest-rate sensitivity have a larger impact, requiring greater spread compensation.

18. Practical Pre-Investment Checks

Before actually buying Khazanah-related bonds, investors need to review not only the issuer’s credit strength but also the contractual terms of the target bond itself. Because Khazanah issues through multiple SPVs, investors should check, for each security, the issuer, guarantor, payment ranking, governing law, tax gross-up provisions, events of default, negative pledge, cross-default, and any language regarding government support. Particularly for sukuk, even if the economic substance is close to a bond, the legal form may involve assets, leases, and agency structures, so the payment mechanism should not be skipped.

The first point to confirm is the scope of Khazanah’s guarantee. The official website explains that SPV-issued MTNs are irrevocably and unconditionally guaranteed by Khazanah, but in the prospectus for each bond, investors need to confirm how the guaranteed obligations, trigger conditions for the guarantee, guarantor obligations, limitations on the guarantee, and tax treatment are described. Where the issuer is an SPV, the credit on which investors actually rely is not the SPV but Khazanah’s guarantee, so this section is the most important.

The second point to confirm is the payment ranking of the debt. Investors should check whether Khazanah’s own debt, guaranteed debt, domestic programmes, foreign-currency programmes, bank borrowings, and future bonds rank effectively pari passu, or whether there is any priority or subordination through specific assets or structure. This point is not sufficiently visible from public materials alone, so the offering circular for the target bond is necessary.

The third point to confirm is redemption concentration. Even for highly rated issuers, if foreign-currency bond maturities are concentrated in a specific year, refinancing costs can rise depending on market conditions. For an investment holding issuer such as Khazanah, asset sales, dividend income, reinvestment, policy investments, and dividends to the government may also overlap around maturity dates. Investors need to review the maturity schedule together with cash balances, short-term investments, and unused borrowing facilities.

The fourth point to confirm is hedging and currency mismatch. Khazanah uses both ringgit-denominated and foreign-currency assets, as well as ringgit-denominated and foreign-currency debt. For investors in foreign-currency bonds, the key question is how the issuer funds foreign-currency payments. If details of FX hedging, foreign-currency assets, foreign-currency income, and foreign-currency liquidity are available, the repayment certainty of foreign-currency bonds can be assessed more precisely.

The fifth point to confirm is the latest rating agency commentary. The 2023 A3 / A- ratings are an important starting point, but for an investment decision in 2026, investors should check subsequent affirmations, outlooks, government-related issuer assessments under rating methodologies, and linkages with the sovereign rating. If it is clear how rating agencies separate Khazanah’s standalone credit profile from government-support uplift, it becomes easier to assess downgrade resilience in a downside scenario.

19. Scenario-Based Credit Assessment

Under the base case, Khazanah is expected to maintain its credit strength as a high-quality quasi-sovereign issuer. As long as Malaysia’s sovereign remains investment grade, Khazanah’s asset value is not materially impaired, RAV / debt remains at a sufficient level, and capital market access is maintained, major concerns over the company’s debt repayment capacity are unlikely to arise. In this case, spreads are likely to remain wider than Malaysian sovereigns but tighter than ordinary corporates or typical investment holding companies.

Under the upside case, Khazanah’s asset value increases further, policy investments are accompanied by commercial results, and initiatives such as MAHB and Jelawang Capital contribute to value creation. In this case, improvement in NAV / RAV, maintenance of dividend capacity, and further stabilisation of capital market access would be confirmed. Spreads could tighten close to sovereign levels, but because the debt is not explicitly guaranteed, it may not necessarily be assessed fully in line with the sovereign.

Under the downside case, domestic equities and overseas investments decline, recovery from policy-driven investments is delayed, and foreign-currency bond market conditions deteriorate at the same time. In this case, RAV / debt would decline and refinancing spreads would widen. Government support expectations may contain rapid credit deterioration, but rating agencies could become more cautious on the outlook due to deterioration in the standalone profile or linkage with the sovereign rating.

Under the stress case, Malaysia’s sovereign rating or outlook deteriorates, Khazanah’s asset value declines at the same time, and foreign-currency bond markets become effectively closed. In this situation, the value of implicit support would remain, but both support capacity and market access would be tested. Bond investors would focus on whether the government provides explicit liquidity support, capital injection, asset transfers, guarantee enhancement, or similar measures. Under stress of this severity, Khazanah’s credit strength would depend heavily not only on its standalone asset value, but also on the Malaysian government’s policy decisions.

20. Report Caveats

This report is an initial issuer summary based on public information and does not verify all contractual information required for an investment decision. In particular, the offering circulars for the target bonds, detailed version of the latest annual report, full rating agency reports, current market prices and spreads, debt maturity schedule, cash balances, and FX hedging policy have not been reviewed. Therefore, the conclusion of this report concerns the “credit framework of the issuer” and is not a buy recommendation for any specific security.

Based on currently available public information, Khazanah’s credit strength is strong, but that strength mainly derives from the combination of government linkage, asset base, and market access. This is a very important credit support factor, but it is different from a legal guarantee. Investors should not take excessive comfort from government linkage, and should review asset coverage, liquidity, bond terms, and spreads together.

21. Conclusion

Khazanah is a high-quality quasi-sovereign issuer with strong government links, a large asset base, and continuing market access. Based on public information, there is no basis to treat its bonds as fully government-guaranteed, but its credit strength is clearly stronger than that of an ordinary investment holding company.

Current public information does not indicate major stress in asset value, profit, dividends, or capital market access. For investment purposes, it is appropriate to assess linkage with the Malaysian sovereign while continuing to monitor Khazanah’s own leverage, liquidity, and discipline around policy investments.

In the final investment decision, whether the spread is sufficient is more important than the credit strength itself. Even on a conservative view, Khazanah is a high-quality government-related issuer, but given the absence of an explicit guarantee, investors should require some additional yield over Malaysian sovereigns. Conversely, if spreads widen to levels comparable with ordinary corporates, relative value is likely to become more apparent given its government links and asset base.

22. Items to Confirm Next

1. Confirm cash balances, debt balances, and maturity distribution from the detailed annual report.
2. Review Khazanah-specific update reports from Moody’s / S&P since 2023.
3. Obtain market prices, yields, and spreads for the 2028 sukuk and 2033 bonds.
4. Track capital requirements for MAHB, Dana Impak, Jelawang Capital, and Dana Warisan.
5. Confirm whether headroom close to the 2024 RAV / debt of 3.2x is maintained.
6. Compare spreads with Malaysian sovereigns, Petronas, major banks, and other Asian government-related issuers.
7. Confirm guarantee language, governing law, payment ranking, and sukuk payment mechanisms for each programme.

13. Short Summary & Conclusion

Khazanah Nasional is a strategic investment holding company owned by the Malaysian government through the Minister of Finance and is a key sovereign wealth vehicle. It is a strongly supported investment holding credit with a close government relationship and large investment assets, while attention is needed to holding-company leverage, liquidity, and refinancing. The credit direction is broadly stable, but it is sensitive to asset value, policy investments, maturity coverage, and assumptions around government support. Investors should confirm the issuer or SPV structure of each bond, the presence or absence of explicit support, RAV / debt, and asset market volatility.

14. Sources / Information Sources

10. Downside Scenarios

The first risk is a decline in portfolio value. If domestic strategic assets, listed equities, and overseas investments decline simultaneously, NAV and RAV would fall and asset coverage would weaken.

The second risk is a deterioration in the refinancing environment. Khazanah has strong capital market access, but if foreign-currency bond markets or sukuk markets become unstable, it could face higher funding costs and constraints on issuance timing.

The third risk is an increase in the share of policy-driven investments. If long-payback, low-return national projects increase too much, policy importance may rise, but financial efficiency and liquidity could deteriorate.

The fourth risk is a weakening of Malaysia’s sovereign credit strength or policy management. Because Khazanah’s credit strength depends heavily on government linkage, changes in sovereign ratings or policy consistency could easily spill over to Khazanah’s spreads and ratings.

11. Points for Investors to Monitor

When assessing Khazanah bonds, they should not be treated as Malaysian government bonds themselves, but as “issuers close to the sovereign, while financial discipline as an asset holding company also matters.” The most important items to confirm are as follows.

12. Conclusion

Khazanah is a high-quality quasi-sovereign issuer with strong government links, a large asset base, and continuing market access. Based on public information, there is no basis to treat its bonds as fully government-guaranteed, but its credit strength is clearly stronger than that of an ordinary investment holding company.

Current public information does not indicate major stress in asset value, profit, dividends, or capital market access. For investment purposes, it is appropriate to assess linkage with the Malaysian sovereign while continuing to monitor Khazanah’s own leverage, liquidity, and discipline around policy investments.

13. Items to Confirm Next

1. Confirm cash balances, debt balances, and maturity distribution from the detailed annual report.
2. Review Khazanah-specific update reports from Moody’s / S&P since 2023.
3. Obtain market prices, yields, and spreads for the 2028 sukuk and 2033 bonds.
4. Track capital requirements for MAHB, Dana Impak, Jelawang Capital, and Dana Warisan.
5. Confirm whether headroom close to the 2024 RAV / debt of 3.2x is maintained.

14. Sources

1. Khazanah Nasional Berhad, "About Us", accessed 7 May 2026.
   https://www.khazanah.com.my/who-we-are/about-us/

2. Khazanah Nasional Berhad, "Khazanah Bonds", accessed 7 May 2026.
   https://www.khazanah.com.my/our-performance/khazanah-bonds/

3. Khazanah Nasional Berhad, "Our Portfolio", accessed 7 May 2026.
   https://www.khazanah.com.my/our-performance/our-portfolio/

4. Khazanah Nasional Berhad, "Khazanah Demonstrates Resilience in 2025 Amidst Global Volatility", 10 Feb 2026.
   https://www.khazanah.com.my/news_press_releases/khazanah-demonstrates-resilience-in-2025-amidst-global-volatility/

5. Khazanah Nasional Berhad, "KAR 2026 Press Release" PDF, 10 Feb 2026.
   https://www.khazanah.com.my/media/uploads/2026/02/KAR-2026_Press-Release-ENG.pdf

6. Khazanah Nasional Berhad, "RM5.1 billion profit from operations for 2024, strong performance of Malaysian investment and significant value creation initiatives", 5 Feb 2025.
   https://www.khazanah.com.my/news_press_releases/rm5-1-billion-profit-from-operations-for-2024-strong-performance-of-malaysian-investment-and-significant-value-creation-initiatives/

7. Khazanah Nasional Berhad, "Khazanah reopens Malaysia's USD Sukuk and Bond Market with a dual-tranche offering", 25 May 2023.
   https://www.khazanah.com.my/news_press_releases/khazanah-reopens-malaysias-usd-sukuk-and-bond-market-with-a-dual-tranche-offering/

8. Khazanah Nasional Berhad, "Khazanah assigned A3/A- by International Credit Rating Agencies Moody's and S&P", 27 Apr 2023.
   https://www.khazanah.com.my/news_press_releases/khazanah-assigned-a3-a-by-international-credit-rating-agencies-moodys-and-sp/

9. Khazanah Nasional Berhad, "Khazanah Leads Malaysia's First Tokenised Sukuk Pilot in Collaboration with the SC", 28 Apr 2026.
   https://www.khazanah.com.my/news_press_releases/khazanah-leads-malaysias-first-tokenised-sukuk-pilot-in-collaboration-with-the-sc/

10. Khazanah board page / leadership profile search result confirming Dato' Seri Anwar Ibrahim as Chairman, accessed 7 May 2026.
    https://www.khazanah.com.my/board_of_directors/goh-ching-yin/

11. Ministry of Finance Malaysia, "S&P Global Ratings Reaffirms Malaysia's Sovereign Credit Ratings And Stable Outlook", 20 Sep 2025.
    https://www.mof.gov.my/portal/en/news/press-release/s-p-global-ratings-reaffirms-malaysias-sovereign-credit-ratings-and-stable-outlook

12. Ministry of Finance Malaysia, "Fitch Ratings Affirms Malaysia's Sovereign Credit Rating At 'BBB+', Outlook Stable", 9 Dec 2025.
    https://www.mof.gov.my/portal/en/news/press-release/fitch-ratings-affirms-malaysias-sovereign-credit-rating-at-bbb-outlook-stable-1

13. Ministry of Finance Malaysia / Bernama citation, "Moody's Affirms Malaysia's Sovereign Credit Rating At A3 With Stable Outlook", 25 Jan 2025.
    https://www.mof.gov.my/portal/en/news/press-citations/moodys-affirms-malaysias-sovereign-credit-rating-at-a3-with-stable-outlook

15. Unconfirmed Items

• Detailed debt maturity schedule, cash balances, and programme usage.
• Khazanah-specific rating update materials since 2023.
• Current prices, yields, and spreads for the 2028 sukuk and 2033 bonds.
• Relationship between 2025 total assets and RAV in the detailed annual report.