Content:
- Introduction of the Bank
- Role of the Bank
- Authority of the Bank
- Governors of the Bank
- References
Introduction of the Bank
The Central Bank of Malaysia which also known as Bank Negara Malaysia is the Malaysian Central Bank. Previously it is known as Central Bank of Malaya or Bank Negara Tanah Melayu.
The Bank is located in Kuala Lumpur which is the federal capital of Malaysia. Its headquarter is in Jalan Dato Onn, Kuala Lumpur.
The Bank is established on 26 January 1959, which its main purpose is to issue currency, act as banker and adviser to the government of Malaysia and regulate the country’s financial institutions, credit system and monetary policy.
Currency used by Malaysia government is Malaysian Ringgit (MYR). The Bank is the only institution permitted to issue the Malaysian Ringgit into circulation.
BNM is a statutory body which is governed by the Central Bank of Malaysia Act 2009.
Role of the Bank
The role of Bank Negara Malaysia is to promote monetary and financial stability. This is aimed at providing a conducive environment for the sustainable growth of the Malaysian economy. Bank Negara Malaysia’s monetary policy stance is to maintain price stability while remaining supportive of growth.
Bank Negara Malaysia is also responsible for financial system stability. This is achieved by developing a sound, resilient, progressive and diversified financial sector which serves to support the sectors of the real economy. It also plays an important function in implementing initiatives to deepen and strengthen the financial markets, including the foreign exchange market.
Bank Negara Malaysia has played a significant developmental role in developing the financial system infrastructure in advancing the financial inclusion agenda. This is to ensure all economic sectors and segments of the society have access to financial services. In addition, Bank Negara Malaysia also oversees the nation’s payment systems infrastructure which emphasize on the efficiency and security of the financial systems.
As the banker and adviser to the Government, Bank Negara Malaysia provides advice on macroeconomic policies and the management of public debt. Bank Negara Malaysia is also the sole authority in issuing the national currency and in managing the country’s international reserves.
Authority of The Bank
The Central Bank is empowered through enactment of legislation by the Parliament of Malaysia. New legislation are created and current legislation is amended to reflect the needs of the time and future.
1. Development Financial Institutions Act 2002
Promotes the development of effective and efficient development financial institutions.
2. Central Bank of Malaysia Act 2009
Provides the establishment, administration and powers of the bank.
This act repealed the Central Bank of Malaysia Act 1958.
3. Money Services Business Act 2011
Provides for regulation of money services business industry which consists of remittance, wholesale currency and currency exchange businesses.
4. Financial Services Act 2013
Consolidates the regulatory and supervisory framework for Malaysia’s banking industry, insurance industry, payment systems, and other relevant entities.
The Act also includes money market oversight and foreign exchange administration matters. This act repealed Banking and Financial Institutions Act 1989, Insurance Act 1996 (though sections 144, 147(4), 147(5), 150, 151 and 224 of the Insurance Act 1996 continue to remain in full force and effect by virtue of section 275 of FSA 2013), Payment Systems Act 2003 and Exchange Control Act.
5. Islamic Financial Services Act 2013
Sets out the regulatory framework for Malaysia’s Islamic financial sector with the principal regulatory objectives of promoting financial stability and compliance with Shariah.
This act repealed Islamic Banking Act 1983 and Takaful Act 1984.
Governors of the Bank
1. Tan Sri William Howard Wilcock (26 January 1959 – July 1962)
2. Tun Ismail Mohd Ali (July 1962 – July 1980)
3. Tan Sri Abdul Aziz Taha (July 1980 – June 1985)
4. Tan Sri Dato’ Jaffar Hussein (June 1985 – May 1994)
5 Tan Sri Dato’ Ahmad bin Mohd Don (May 1994 – August 1998)
6 Tan Sri Dato’ Seri Ali Abul Hassan Sulaiman (15 September 1998 – 30 April 2000)
7 Tan Sri Dato’ Sri Dr. Zeti Akhtar Aziz (1 May 2000 – 30 April 2016)
8 Tan Sri Muhammad bin Ibrahim (1 May 2016 – 15 June 2018)
9 Tan Sri Nor Shamsiah Mohd Yunus (1 July 2018 – 30 June 2023)
10 Dato’ Shaik Abdul Rasheed Abdul Ghaffour (1 July 2023 – present)
References
https://en.wikipedia.org/wiki/Central_Bank_of_Malaysia