BANK NEGARA MALAYSIA

Established on 26 January 1959 under the Central Bank of Malaysia Act 1958 (CBA 1958).

The CBA 1958 has been repealed by the Central Bank of Malaysia Act 2009 which became

effective on 25 November 2009. It is a statutory body wholly owned by the Government of

Malaysia with the paid-up capital progressively increased, currently at RM100 million. The

Bank reports to the Minister of Finance, Malaysia and keeps the Minister informed of matters

pertaining to monetary and financial sector policies.

Roles and Functions  

Among the major role of the Bank is the prudent conduct of monetary policy, which has

seen generally low and stable inflation for decades and thereby, preserving the purchasing

power of the ringgit. The Bank is also responsible for bringing about financial system

stability and fostering a sound and progressive financial sector. There is now in place a well

diversified, comprehensive and resilient financial sector, that is able to meet the increasingly

sophisticated needs of consumers and businesses, and which has become a growth driver in

the economy.

The Bank also plays a significant developmental role, including development of financial

system infrastructure with major emphasis placed on building the nation\'s efficient and

secured payment systems as well as the necessary institutions (including Securities

Commission, KLSE, now known as Bursa Malaysia and Credit Guarantee Corporation) which

are important towards building a comprehensive, robust and resilient financial system.

The Bank actively promotes financial inclusion, which has led to improved access to

financial services for all economic sectors and segments of society, thereby supporting

balanced economic growth.

Other important roles of the Bank are being a banker and adviser to the Government,

playing an active role in advising on macroeconomic policies and managing the public debt. It

is also the sole authority in issuing currency as well as managing the country\'s international

reserves.

The roles of the Bank are supported by 37 departments/units in the Bank covering seven

functional areas as follows:

Economics & Monetary Policy

Primarily provides good technical and research support on growth-related issues to enhance

formulation of monetary and credit policies in promoting monetary stability and ensuring the

availability of adequate credit to finance economic growth.

Investment and operations

Manage domestic liquidity and exchange rates to ensure that monetary policy targets are

achieved as well as managing external reserves to safeguard its value and optimise its returns.

It also has the responsibility of providing advice and assistance to the Government in the area

of debt and fund management and contributing to domestic financial market development.

Regulation

Promote financial sector stability through the progressive development of sustainable, robust

and sound financial institutions and financial infrastructure, thus enabling a competitive local

financial industry to be resilient against the changing future environment as well as leads

initiatives to enhance access to financing. It also formulates and implements policies and

strategies towards building and positioning Malaysia as a premier integrated Islamic Financial

Centre and enhance the financial capability of consumers.

Payment systems

Develop policies and strategies to promote reliable, secure and efficient clearing, settlement

and payment systems in the country.

Supervision

Develop, enhance and implement an effective surveillance framework to ensure safety and

soundness of financial institutions and to enforce sound practices in them.

Organisational development

Spearhead the Bank\'s strategic management, organisational-performance management and

programme management functions to drive its performance-improvement processes and

strengthening the capacity building of the Bank. It also leads and drives human resources

initiatives and other strategic activities to ensure that the overall Human Capital Management

framework is implemented effectively.

Communications

The communications function has assumed increasing importance in response to the

heightened demands of the various stakeholders, seeking greater transparency and disclosure.