The banking system consisting of commercial banks, investment banks and Islamic banks is the main mobilizer of funds and an important source of financing to support economic activities in Malaysia. The non-bank financial intermediaries, comprising development financial institutions, provident and pension funds insurance companies, complement the banking institutions in mobilizing savings and meeting the financial needs of the economy.
Bank Negara Malaysia (the Bank), the Central Bank, is the apex of the monetary and banking structure of the country. Its main objectives as defined in the Central Bank of Malaysia Act 1958 are to:
- issue currency and keep the reserves safeguarding the value of the currency
- act as a banker and financial adviser to the Government
- promote monetary stability and a sound financial structure
- promote the reliable, efficient and smooth operation of national payment and settlement systems and to ensure that the national payment and settlement systems policy is directed to the advantage of Malaysia; and
- influence the credit situation to the advantage of Malaysia.
Malaysia has many Developments Financial Institutions (DFIs) established to develop and promote strategic economic sectors including the manufacturing and export sectors, small and medium enterprises (SMEs), as well as the agriculture, infrastructure and maritime sectors. These DFIs complement the banking institutions by providing an array of financial and non-financial services to support development of the strategic sectors.
Malaysia’s initiative in strengthening the Islamic Financial System domestically and internationally have gained acknowledgement by the International financial fraternity. The government has plans to make Malaysia a leading International Financial hub.
Last Updated on: 18-11-2009