On November 12, 2019, Negara Malaysia Bank (“BNM”) released a strategy document entitled “Repurchase Agreement transactions”.- It came into effect that day. “This strategy document sets out the Bank`s revised requirements and expectations for market participants who conduct repo transactions on ringgit and non-ringgit-repo and auto-repo operations … Bank Negara Malaysia said in a statement bit.ly/33FNifr. The repo strategy document aims to present the volume of repo transactions that can be carried out by licensed banks and investment banks, establish regulatory requirements and expectations regarding the repo transactions of licensed banks and investment banks, and promote sound risk management practices of licensed banks and investment banks to carry out transactions. The revision of the strategy document consists mainly of the following: this document replaces the pension strategy document published on 31 July 2015 (BNM/RH/PD 032-3). The revised strategy document will come into effect on the day the final policy is issued. This strategic document is to be read with other BNM documents and policy directions, in particular the capital adequacy framework published on 03 May 2019 (Basel II – Risk Weighted Assets); The requirements for limiting the exposure of a counterparty, adopted on July 9, 2014; Foreign exchange management rules The Code of Conduct for Malaysian Wholesale Financial Markets, published on 13 April 2017; Net financial stability requirements adopted on July 31, 2019; STATsmart reporting obligations. The trade policy document applies to all market players who are licensed banks and investment banks and does not apply to repo transactions carried out by foreign branches of licensed banks and investment banks and repo transactions with BNM. It applies to repo transactions on Ringgit and non-Ringgit repo securities and to repurchase transactions, including all intentions to sell or purchase repo securities directly completed, with the intention of redeeming or reselling them at a later date. Repo Securities refers to the underlying securities of the pension transaction. The content of a transaction takes precedence over its form to determine whether a transaction is regulated in this strategy document. KUALA LUMPUR, Nov 12 (Reuters) – Malaysia`s central bank on Tuesday extended the maximum content of a pension repurchase agreement or repo to five years. BNM has published an exhibition project that outlines the revised expectations of the banks granted and the investment banks granted that contract pension transactions (repo).
This strategy document applies to repurchase transactions on ringgit and non-ringgit-repo securities and repurchase transactions, including all pension securities sold or purchased directly, with the intention of redeeming or reselling them at a later date. The response period for the consultation ends on September 13, 2019. Our Standards: Thomson Reuters Trust Principles.