Highlights of Bank Negara Financial Stability Report 2016

Maybank Investment Bank Research has

 

Cross-Sector Developments

• Malaysia’s debt securities market remains a key source of financing for corporates, rising to account for 37.4% of total corporate financing as at end-2016.

• New issuances of corporate bonds during the year were led by firms in the finance, insurance and real estate; infrastructure; and electricity, gas and water supply sectors.

• In the FX market, the implementation of measures by the FMC in December led to improved onshore liquidity and curtailed the disruptive influence on ringgit volatility from speculative transactions in the ringgit NDF market.

• Local currency settlements in ringgit and renminbi have continued to increase in volume, reducing costs for businesses and contributing to the development of deeper regional financial markets

• Bank Negara set up the Financial Technology Enabler Group to provide a safe and supportive regulatory environment for financial technology (FinTech) innovations - it is tasked to formulate policy measures and strategies for the adoption of technological innovations in the financial services industry.

Payment and Settlement Systems

• Amid the growing threat of cyberattacks globally, effective management of cyber risks was a key focus of Bank Negara’s oversight activities.

• Progress continues to be made towards achieving the electronic payment (e-payment) targets set out in the Financial Sector Blueprint 2011–2020, driven by increased adoption of credit transfers and payment card transactions.

• A key strategic priority for Bank Negara in 2017 will be to facilitate open and fair access to shared payment infrastructures by banks and non-bank payment service providers with the view to create a more competitive payment landscape that fosters continuous improvements in payment services.