Bank Negara, Malaysia’s central bank, has launched a consultation programme aimed at delivering standards for providers of multi-dealer FX and money market electronic platforms, including inter-dealer brokers. The bank has released an Exposure Draft and invited feedback before July 15 2019. The background to the proposed regulation is the continued scrutiny of offshore access to […]
Tag: Bank Negara
Malaysia’s central bank, Bank Negara, has announced the loosening of foreign exchange controls as it further liberalises the local FX market.
Under the new regulations, local companies will no longer need to convert foreign earnings back into Malaysian ringgit before re-converting to another currency at a later date, instead exporters will be allowed to automatically sweep export proceeds into their trade foreign currency accounts maintained with onshore banks to meet up to six months’ foreign currency obligations, subject to pre-reporting those requirements.
Today’s column is definitely not one for the teenagers – indeed it looks at an issue only those of us of a (ahem) certain vintage, will remember.
I was fascinated to read over the weekend that there is a something bubbling up in Malaysia over FX losses made by the country’s central bank in the early 1990s. Apparently the issue has re-emerged as a whistle blower now claims that the bank lost $10 billion trading and that there was no official investigation.
Malaysia’s central bank, Bank Negara, has continued its offensive against what it believes to be market misconduct, saying it has initiated enforcement actions against an un-named local bank relating to dealers’ misconduct involving the fixing of the USD/MYR exchange rate.
Bank Negara says, “The finding indicates that there were communications with traders from other foreign financial institutions which included inappropriate references to the fixing rate submission process. In this regard, the Bank has commenced the due process as stipulated under the Financial Services Act.”
The Malaysian Ringgit is approaching its lowest trading level against the US dollar since the Asian crisis in 1998 when the country was prompted to introduce capital controls.
In an attempt to stem the outflow of MYR, the country’s central bank, Bank Negara, last week issued a warning regarding offshore NDF trading – a move widely seen as a reintroduction of capital controls – by sending letters to compliance heads at onshore and offshore banks demanding they commit to ceasing offshore trade of MYR NDFs.
Bank Negara Malaysia is issuing a policy document on a proposed Code of Conduct for Malaysian wholesale financial markets “to uphold professionalism and integrity in the financial markets”.
The draft sets out principles and standards to be observed by market participants in the Malaysian wholesale financial markets, including FX and money markets. It also outlines the administrative, civil and criminal actions that may be undertaken by Bank Negara on misconduct
Market participants are invited to provide written feedback on the draft, including suggestions on areas requiring further clarity and alternative proposals that Bank Negara should consider, ahead of a proposed release early in 2017.