Today’s conference takes place against the backdrop of a rapidly evolving global trade and financial landscape. Over the last decade, intra-regional trade has accelerated with China becoming a large export market for many regional economies as well as growing source of foreign direct investment (“FDI”). This has created a growing need for region-centric payment and settlement solutions that are faster, more transparent, and better aligned with businesses’ underlying currency exposures.

In this environment, financial connectivity is no longer only about market access. It is equally about the availability of practical, efficient and reliable channels for businesses to settle, hedge and finance their cross-border activities with confidence.

For Malaysia, China has grown to become Malaysia’s most important trade and investment partner, and the scale and breadth of our economic relationship drive a natural demand for more efficient access to both RMB and the MYR — whether for trade settlement, investment flows, treasury operations or risk management.

Since 2009, Bank Negara Malaysia (“BNM”) and the People’s Bank of China (“PBOC”) have collaborated on a series of initiatives to facilitate the settlement of international trade transactions in RMB and MYR.

These include the bilateral currency swap arrangement and the Qualifying Foreign Institutional Investors (“QFII”) scheme in 2009, the introduction of direct RMB–MYR trading in 2010, as well as the Cross Border Collateral Arrangement (“CBCA”) and Renminbi Liquidity Facility (“RLF”) in 2013. The appointment of Bank of China (Malaysia) Berhad ("BOCM") as the RMB clearing bank in 2015 has also helped facilitate access to RMB liquidity for financial institutions in Malaysia.

A more efficient RMB–MYR settlement is beneficial to Malaysia and China

Wider access to RMB and MYR settlement channels can help reduce unnecessary conversion layers, enhance pricing transparency, and support more effective management of foreign exchange exposures. More importantly, it strengthens the financial connectivity needed to support the growing scale and sophistication of Malaysia–China trade and investment flows.

Encouragingly, these efforts have translated into tangible progress. The share of RMB and MYR in Malaysia–China trade settlement has increased significantly, from 1.2% or RM0.5 billion in 2009 to 25.4% or RM68 billion in 2025. This upward trajectory reflects the benefits of sustained policy coordination, strong market infrastructure and continued industry participation in supporting the needs of businesses on both sides.

Financial intermediaries’ role in RMB infrastructure

Within the drive to broaden and deepen the market, financial intermediaries has also played an important operational role. Since its appointment by BNM as the RMB onshore settlement institution in 2011, and later by the PBOC as the RMB clearing bank in Malaysia in 2015, BOCM has helped strengthen access to RMB liquidity and settlement services for financial institutions and businesses in Malaysia.

This role has continued to evolve alongside the growing needs of the market, including in being connected to key settlement channels; namely CIPS, RENTAS and SWIFT, and has been a direct participant of CIPS since 2021. These connectivities support both onshore and offshore RMB payments, including local RMB book transfers, cross-border RMB payments into Mainland China, and payments to offshore RMB markets through Hong Kong and other global channels.

With these foundations firmly in place, the opportunity ahead is to deepen two-way RMB–MYR flows — making RMB more accessible to Malaysian businesses, while providing Chinese and regional corporates and investors with approved and well-supported channels to access the MYR.

Highlight role of financial intermediaries to deepen two-way RMB–MYR flows

This is where financial intermediaries such as BOC would continue to make a meaningful difference.

With the regional network, client relationships and technical capabilities, financial intermediaries are well placed to support greater two-way currency access between Malaysia and China. This includes continuing to facilitate access to RMB in Malaysia, while also expanding access to MYR for corporates and investors in Mainland China, Hong Kong and the wider region.

Recent developments provide a stronger foundation for this. In March 2025, BOCM appointed BOC Hong Kong as its Appointed Overseas Office (“AOO”), creating an approved channel for non-residents to access MYR-related products and settlement services from abroad. BNM views this as a further step in broadening access to MYR outside Malaysia, particularly for clients in Hong Kong and the wider China-facing financial ecosystem.

Drive local currency use in ASEAN

From a regional initiative perspective, the participation of BOC entities as Appointed Cross-Currency Dealers (“ACCDs”) under the Local Currency Transaction Framework (“LCTF”) in Malaysia, Thailand and Indonesia, can facilitate access across RMB, MYR, THB and IDR.

In practical terms, this means BOC can support ringgit access not just in Hong Kong, but also in Thailand and Indonesia, while also helping Malaysian businesses access regional currencies such as THB and IDR.

Market development through awareness and product offerings

To build on this momentum, the next priority is to strengthen market adoption. While infrastructure provides the foundation, wider usage ultimately depends on whether businesses can clearly identify where RMB–MYR settlement delivers tangible benefits – whether through reduced conversion costs, better pricing and simplified and more effective foreign exchange risk management.

This calls for continued awareness-building and client engagement. Adoption will be more sustained when corporates, investors and financial institutions have a clearer understanding of the practical value proposition — particularly in sectors and transactions where there is a natural currency fit, whether through trade with China, Malaysia-related investment flows, or treasury operations involving RMB and MYR.

Commercial banks are natural partners in this process. Beyond providing settlement access, banks can help deepen product offerings, support liquidity, improve price transparency and guide clients in assessing when local currency settlement is commercially viable. For example, there could be opportunities to unlock greater scope for two-way portfolio investments flows across markets.

We continue to see greater bilateral connectivity reflected beyond trade settlement, in the form of growing financial market participation. As at 29 May 2026, investors from China held around RM35 billion in Malaysian Government Securities and Government Investment Issues. This indicates that Malaysia's domestic bond market continues to attract interest from Chinese corporates and individual investors.

These portfolio flows are important because they complement the broader trade and investment relationship between Malaysia and China. Greater participation by regional investors can contribute to a more diversified investor base, support market liquidity and deepen financial linkages between both economies. It also underscores the importance of ensuring that investors have access to efficient and reliable settlement, hedging and liquidity solutions in both RMB and MYR.

At the same time, currency usage patterns do not change overnight. They are shaped by liquidity, market depth, pricing conventions, operational familiarity and the practical needs of businesses. The approach must therefore remain gradual and market-driven — with policymakers, financial institutions and corporates each playing their part in building a stronger and more efficient local currency ecosystem.

The broader objective is to ensure that financial connectivity continues to serve the needs of the real economy — helping businesses trade, invest and manage risks more efficiently as Malaysia–China and regional linkages continue to deepen.

Malaysia remains committed to strengthening RMB–MYR connectivity in a practical and market-driven manner. Greater use of RMB and MYR, where commercially viable, can improve transaction efficiency, deepen price discovery in regional currency pairs, and support a more resilient regional financial architecture.

On that note, I would once again congratulate BOCM on this important milestone. As a longstanding partner in Malaysia’s RMB settlement ecosystem, BOCM is positioned to continue supporting businesses as the demands of cross-border trade, investment and treasury activities continue to grow in scale and complexity.

I hope today’s conference will generate useful discussions and practical ideas to further deepen Malaysia–China financial connectivity.

Bank Negara Malaysia 
25 June 2026