In a bid to improve capital-markets efficiency and depth, the Central Bank of Malaysia, Bank Negara Malaysia (BNM), will further liberalize and simplify rules that currently govern foreign-exchange trading, according to a report in Citigroup’s MarketWatch.
From April 1, 2004, the aggregate limit for overnight overdraft facilities will be increased to MYR200 million from MYR10 million, the same level as the intra-day limit of MYR200 million. Essentially, this will increase investors’ buffer in the event of a shortfall relating to unforeseen or inadvertent technical or administrative errors or time zone delays related to the settlement of trades on the Malaysia Securities Exchange Bhd.
Also, the Multilateral Development Banks (MDBs), where Malaysia is a member, and foreign multinational corporations (MNCs), may issue MYR-denominated bonds in Malaysia to raise domestic funds. Residents and selected institutions will be allowed to invest abroad, providing local fund managers greater flexibility in the management of funds, according to the report.