Featured Product

    BNM Launches MYOR and Consults on MYOR-i Reference Rates in Malaysia

    September 24, 2021

    The Central Bank of Malaysia (BNM) announced the launch of Malaysian Overnight Rate (MYOR) as the new alternative reference rate for Malaysia. In conjunction with the launch, BNM has published a policy document on MYOR. The policy document sets out the benchmark design, methodology, and governance framework to ensure the integrity and credibility of MYOR. As per the policy, BNM will administer and calculate MYOR as the volume-weighted average rate of unsecured overnight Ringgit interbank transactions, including the overnight monetary operations of BNM (excluding Standing Facilities). BNM will conduct periodic reviews of the MYOR to ensure it remains robust and representative of conditions in the underlying market. This policy document came into effect on September 24, 2021.

    BNM has published another policy document that sets out requirements to be observed by the Kuala Lumpur Interbank Offered Rate (KLIBOR) submitters and the designated KLIBOR distributor in undertaking the KLIBOR rate-setting process. This policy document comes into effect on September 30, 2021. In Malaysia, the MYOR will run in parallel to the existing KLIBOR, with periodic reviews to ensure that the financial benchmark rates remain robust and reflective of an active underlying market. This multiple-rate approach is supported by the Financial Stability Board (FSB) and adopted by many other jurisdictions. BNM also announced that it will discontinue, on January 01, 2023, the publication of the two- and twelve-month KLIBOR tenors, which are the least referenced rates in the market for financial contracts. The remaining one-, three-, and six-month KLIBOR tenors, which continue to reflect an active underlying market, will be reviewed in the second half of 2022. Any updates from the review will be communicated thereafter. The Financial Markets Committee will engage the International Swaps and Derivatives Association (ISDA) to ensure continuity of KLIBOR derivatives contracts in the event of a temporary or permanent discontinuation of KLIBOR publication.

    As part of ongoing efforts to further develop the Islamic financial market, BNM, in collaboration with the Financial Markets Committee and the AIBIM-FMAM Islamic Market Technical and Development Committee, will develop a new Islamic benchmark rate (Malaysia Islamic Overnight Rate or MYOR-i) to replace the Kuala Lumpur Islamic Reference Rate (KLIRR) by the first half of 2022. In this regard, BNM has published an exposure draft that sets out the benchmark design, methodology, and governance framework to ensure the integrity and credibility of Malaysia Islamic Overnight Rate (MYOR-i). BNM is requesting responses on the exposure draft by October 25, 2021. In a separate joint statement, BNM and the Bank of Thailand (BOT) invited banking institutions from Malaysia and Thailand to indicate their interest to be a Qualified ASEAN Bank (QAB) in Malaysia and Thailand. Banking institutions have been invited pursuant to the bilateral arrangement under the Association of Southeast Asian Nations (ASEAN) Banking Integration Framework between BNM and BOT, which concluded in April 2019.

     

    Related Links

    Comment Due Date: October 25, 2021 (MYOR-i)

    Effective Date: September 24, 2021 (MYOR)/September 30, 2021 (KLIBOR rate-setting)

    Keywords: Asia Pacific, Malaysia, Thailand, Banking, Securities, MYOR, KLIBOR, Interest Rate Benchmarks, Interest Rate Risk, Alternative Reference Rates, Islamic Finance, MYOR-I, ASEAN, Qualified ASEAN Bank, Benchmark Reforms, BOT, BNM

    Related Articles
    News

    US Agencies Issue Several Regulatory and Reporting Updates

    The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.

    January 04, 2023 WebPage Regulatory News
    News

    ECB Issues Multiple Reports and Regulatory Updates for Banks

    The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.

    January 01, 2023 WebPage Regulatory News
    News

    HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements

    The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.

    December 30, 2022 WebPage Regulatory News
    News

    EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR

    The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.

    December 29, 2022 WebPage Regulatory News
    News

    CBIRC Revises Measures on Corporate Governance Supervision

    The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.

    December 29, 2022 WebPage Regulatory News
    News

    HKMA Publications Address Sustainability Issues in Financial Sector

    The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.

    December 23, 2022 WebPage Regulatory News
    News

    EBA Updates Address Basel and NPL Requirements for Banks

    The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.

    December 22, 2022 WebPage Regulatory News
    News

    ESMA Publishes 2022 ESEF XBRL Taxonomy and Conformance Suite

    The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.

    December 22, 2022 WebPage Regulatory News
    News

    FCA Sets up ESG Committee, Imposes Penalties, and Issues Other Updates

    The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.

    December 20, 2022 WebPage Regulatory News
    News

    FSB Reports Assess NBFI Sector and Progress on LIBOR Transition

    The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.

    December 20, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8697