KUALA LUMPUR: Bank Negara is expected to unveil a new code of conduct for the Malaysian wholesale money and foreign exchange (forex) markets by January next year to enhance the professional and ethical standards of the financial industry.
According to central bank governor Datuk Muhammad Ibrahim, the consultation paper on the new code of conduct for the wholesale money and forex markets, which was launched yesterday, would undergo a one-month period of gathering feedback from industry players before being finalised and launched early next year.
“After one month (of consultation with industry players), we will look at the concept, and by early January, it will be ready,” Muhammad told reporters after delivering a special address at the signing ceremony of the collaboration agreement of the Asian Institute of Chartered Bankers (AICB), the Financial Markets Association of Malaysia (FMAM) and the Asian Banking School (ABS) here yesterday.
Muhammad said the proposed new code of conduct would be adopted by the industry and would scope all activities within the forex and money markets as well as the activities of regulated entities in other markets.
“Hence, the code of conduct will be applicable to fund-management companies, corporations and providers of electronic trading and broking systems that deal in the wholesale financial markets as well as interbank players in the bond markets,” Muhammad said.
He said Bank Negara would invite comments from market participants and the general public, including corporations that deal in the wholesale financial markets, for the consultation papers on the proposed code of conduct.
“The code of conduct sets out clear principles and standards to be observed by market participants and lays out the role of industry associations in preserving market order and stability. It would also include enhanced requirements for institutions to have robust systems and internal controls to safeguard professionalism and integrity of the financial markets,” Muhammad said.
“With the code of conduct, we expect the financial market community to develop and maintain a corporate culture that emphasises the importance of professionalism and ethical standards, compliance with laws and regulations and consumer protection,” he said.
In addition, Muhammad said the initiative would be supported by strong and effective oversight by senior management.
“Explicit responsibilities will be placed on the senior management to set ‘the right tone from the top’ in shaping the core values and culture of the institution,” Muhammad stressed.
He noted that the proposed new code of conduct would complement and strengthen the efforts of the AICB, FMAM and ABS in raising professional standards.
The professional bodies of the financial industry yesterday signed a collaboration agreement to create a much more robust and professional practice and policy aimed at raising the standards of their members’ conduct and discipline.
In the collaboration, AICB would admit ordinary members of FMAM as associate members of AICB and an appropriate continuing professional development requirement would be in place to support the members’ professional development journey. ABS would be the sole provider in delivering workshops for the Pasaran Kewangan Malaysia Certificate and the Investor Protection Professional Certification examinations for FMAM.
“This collaboration will mark the beginning of a strong partnership between AICB, FMAM and ABS in driving the agenda of professionalism in banking,” AICB and ABS chairman Tan Sri Azman Hashim said.