KUALA LUMPUR: Bank Negara Malaysia (BNM) has not issued any circular to banks to stop them from taking fixing orders from offshore banks, said its Governor Tan Sri Dr Zeti Akhtar Aziz.
“BNM did not issue such circular. We just reinforced all the rules that we have in place.
“There is nothing specific. We reminded players in the market of whatever rules that we have in place,” Zeti told reporters after attending the World Bank Global Findex conference here yesterday.
Zeti was responding to a report that the central bank had issued a circular to foreign exchange dealers of both local and foreign institutions this week.
According to the report, BNM had issued a circular to financial institutions’ treasury departments on Tuesday to disallow onshore banks from taking onshore fixing orders from offshore banks.
The central bank governor also reiterated that BNM had no plans to peg the ringgit.
“There is no intention to peg (the ringgit), or moving to a less flexible exchange rate regime.
“Malaysia has solid, strong and resilient financial system.
We have high level of reserves and that is what reserves are for, to represent buffers during this period,” said Zeti.
A BNM official spokeswoman later clarified with Bernama that it had always been the requirement that all foreign exchange transactions were backed by underlying transactions.
“Banks are reminded that they can decline the orders (fixing orders from offshore) which does not meet the requirement.
“Banks can freely conduct foreign exchange transactions throughout the day with onshore banks,” said the spokeswoman who requested anonimity. — Bernama