After the doldrums, the sector is expected to pick up momentum in the second half of next year with a recovery in, among others, oil prices as well as a clear direction on US policies especially on its interest rates
KUALA LUMPUR: Bank Negara Malaysia (BNM) will introduce more regulatory measures over next seven months to strengthen banking system, says its Governor Datuk Muhammad Ibrahim.
He said on Thursday that first, it would implement a mandatory employment reference check for financial industry employees. This, he added, was to remove employee information asymmetries during job transitions.
Second, BNM would share with the industry proposed revisions to the outsourcing policy to improve the governance and supervision of financial institutions, especially involving cross-border arrangements.
“The revisions also aim to better support the development of domestic expertise and capacity in core functions of the banking industry,” he said.
Third, Muhammad said a shared security operations centre for the financial industry (FINSOC) will be set up in coordination with the industry to support the continuous and proactive monitoring of cyber threats.
“Finally, by 2018, we hope to operationalise an industry-wide implementation of e-KYC (know your customers) for the on-boarding of customers,” he added.
He was delivering his keynote speech on the “State of the industry” at ASLI’s 21st Malaysian banking summit.
Muhammad pointed out further progress has also been made on the development of the policy framework for domestic systemically important banks (D-SIBs).
He said survey results collected from banking institutions and financial holding companies earlier this year were being analysed and they would need to be refined further on the methodology to identify D-SIBs.
“This will form part of the D-SIB policy framework which will be released later this year for industry consultation,” he added.
Beyond the immediate term, BNM was looking at introducing enhanced standards on measuring capital requirements and outline expectations on recovery planning, in line with global reforms.
“In doing so, we will engage the industry on the potential domestic implications, and make adjustments where necessary to ensure that these standards are phased-in seamlessly,” he said.
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