Some of the new rules include allowing investment banks in Malaysia to undertake foreign currency business subject to a supervisory review on their capability in this area; abolishing the net open position limit of licensed onshore banks which are currently capped at 20% of their capital base; and abolishing the limits imposed on onshore banks for foreign currency accounts maintained by residents.
Other rules include increasing the limit for resident individuals, corporations and institutional investors to invest in foreign currency assets; increasing the limit of foreign currency borrowings; and providing further flexibility for non-resident stockbroking companies and custodian banks to obtain ringgit overdraft facilities.
Bank Negara imposed capital controls and fixed the ringgit to the US dollar during the Asian financial crisis of 1997/98. As a result, many Malaysian FX dealers moved to neighbouring
Over recent years, the foreign exchange administration policies have been progressively liberalised with the aim of enhancing