(From left) Finance Minister II Datuk Seri Amir Hamzah Azizan, Bank Negara Malaysia governor Datuk Shaik Abdul Rasheed Ghaffour and Rafiz Azuan officiating the National Resolution Symposium 2025.
Financial system resilience continues to be the central theme of Perbadanan Insurans Deposit Malaysia (PIDM)’s National Resolution Symposium (NRS) 2025, which was held on Aug 26 and 27.
A panel titled 'Resolution Planning in the Era of Deregulation’ featured senior resolution experts with hands-on experience in managing financial institution failures: Bank of England Resolution Directorate director Geoff Davis, Bank Guarantee Fund management board president Maciej Szczęsny, the European Union Single Resolution Board former chair Dr Elke König, who attended virtually.
PIDM executive vice president Afiza Abdullah moderated the session.
The panellists shared invaluable experiences in managing failing institutions, demonstrating why preparation is vital.
For example, Davis recounted how careful planning enabled the Bank of England to swiftly sell Silicon Valley Bank (SVB) UK to HSBC over a single weekend, preventing wider fallout and avoiding costs to taxpayers.
Szczęsny detailed how Poland's Bank Guarantee Fund successfully used a 'bridge bank' solution to protect depositors when no buyer could be found, a success attributed to extensive preparation and scenario-planning.
König highlighted how the Single Resolution Board's flexible approach in resolution ensured continuity of services without threatening financial stability. Flexibility in resolution can only be exercised credibly with scenario planning.
The panellists underscored several key takeaways from their experiences:
> Resolution planning provides crucial speed, structure and flexibility in a crisis.
> Banks that are initially sceptical of recovery and resolution planning often discover its value, as it exposes hidden weaknesses and leads to stronger risk management and greater efficiency.
> Optionality—having multiple pathways to resolve a failing bank—is critical for maintaining flexibility and ensuring the financial system is not overwhelmed by a failure.
> Preparedness is no longer optional or limited to the largest institutions; it is essential for all banks to safeguard systemic resilience.
> Crisis preparedness must not be undermined even in an era of deregulation. In fact, resilience is the ultimate competitiveness in such an environment.
(From left) Afiza, Davis, Szczęsny and König (connected via video on screen behind), discussed crisis preparedness and how resolution planning helps protect financial stability.
A nation's collective readiness
Finance Minister II Datuk Seri Amir Hamzah Azizan emphasised in his keynote address at the NRS that "uncertainty is no longer a distant possibility, but a present reality".
He stressed that financial stability hinges not only on the strength of individual institutions but also on the industry's collective readiness to respond swiftly and effectively to disruptions.
Recent bank failures abroad, such as Silicon Valley Bank and Credit Suisse, serve as stark reminders of how rapidly instability can spread.
PIDM, established in 2005, acts as Malaysia's resolution authority for its member institutions and is responsible for ensuring that insolvent financial institutions can be resolved in an orderly way.
This crucial role involves protecting the public’s interests and avoiding costly taxpayer bailouts.
PIDM chief executive officer Rafiz Azuan Abdullah noted in his welcoming remarks that the collective preparedness of all stakeholders in the financial sector is paramount. He stressed that resolution planning is not about predicting the next crisis, but about ensuring swift and decisive action when disruption occurs.
Building resilience for generations
The NRS 2025 coincides with PIDM’s 20th anniversary. The establishment of PIDM, a deposit insurer and a resolution authority, eight years after the 1997 Asian Financial Crisis, marked a significant milestone in Malaysia's journey in strengthening its financial safety net and enhancing financial system resilience.
Over two decades, PIDM has built public trust through its awareness programmes and advanced Malaysia's resolution planning framework to ensure that its member institutions can remain resilient in the face of uncertainty.
To further build on this foundation and ensure financial system stability for future generations, PIDM's ongoing commitment to preparedness involves strengthening regional coordination with deposit insurers in other jurisdictions and testing its preparedness through robust crisis simulations and scenario planning.
This sustained effort ensures that Malaysians’ livelihoods and savings are protected behind the scenes.
