Find Banking and Financial Services expertise in Malaysia
Malaysia has a deep and sophisticated financial sector which includes conventional commercial banks, Islamic banks, investment banks, insurance companies and other institutions dealing in a wide range of financial products. The sector saw considerable progress in the 2000s, experiencing restructuring, rationalisation and gradual liberalisation. The country saw more diversified and developed financial markets, alongside the increasing presence of international powers. The strength of the financial sector saw it maintaining general confidence and stability throughout the 2007-12 global financial crisis. Malaysia retains its position as a leader in the global market within the Islamic finance sector. The role that the financial services sector plays in Malaysia’s economy grew throughout the 2000s, with its GDP share increasing from an average of 9.9% between 2000 and 2005 to 10.9% between 2006 and 2009. By 2011 it had risen to 11.6% of the country’s real GDP. The largest three banks in the country, in order of market capitalisation, are Maybank, CIMB and Public Bank. Additionally, Malaysia possesses three large microfinance institutions – AIM, YUM and TEKUN. Each of these targets different groups of people with its own lending system, and have been subsidised by the government since their existence. The capital market is also a key part of the infrastructure of the financial services.
Regulation of Financial Services
Bank Negara Malaysia (BNM) is the central bank of Malaysia which, along with the Securities Commission, regulates the financial sector. The Central Bank of Malaysia Act in 2009 provided a more thorough governance framework, with a greater degree of accountability and transparency. It clarified the roles and responsibilities that BNM holds as a central bank. The Act also promoted BNM’s role in developing Malaysia as an international Islamic financial centre. The World Economic Forum’s Global Competitiveness Report (2012-13) rated Malaysia’s banks 37th in the world for soundness, with a value of 5.7 out of 7 above a world mean of 5.1.
Development of Financial Services
The maturity of Malaysia’s financial sector is reflected in its very high rankings in the World Bank’s Ease of Doing Business Index, placing 1st in the world (out of 183 countries) for getting credit. It also placed strongly in relation to protecting investors, coming 4th in the world, below only the well-developed sectors of New Zealand, Singapore and Hong Kong. In the World Economic Forum’s Global Competitiveness Report (2012-13) Malaysia ranked 24th in the world (out of 142 countries) for availability of financial services, with a value of 5.6 out of 7, above a world mean of 4.5. In relation to affordability of financial services it rated highly at 11th and for financing through the local equity market it placed a similarly strong 9th. For ease of access to loans it placed 8th, just below the strong financial system of Hong Kong.
|Banking and Financial Services organisations in Malaysia|
|Bank Negara Malaysia||