As part of the announcement of the liberalisation measures for the financial sector, this statement provides the details on the issuance of new commercial banking licences.

New commercial banking licences to specialised players

Up to two new commercial banking licences will be issued to qualified foreign players in specialised areas of business to address gaps in the financial sector and that will spur development in targeted economic sectors.

In assessing the merits of the applications, the following criteria will be adopted:

• The applicant must be a financially sound licensed foreign financial institution with strong reputation and track record in the specialised area of business;
• The applicant must be regulated and supervised by a competent home regulatory authority;
• The applicant must be supported by strong reputable shareholders that are able to provide sustainable support; and
• The applicant must demonstrate, through a comprehensive business plan, a strong value proposition in the specialised areas of expertise which can serve the new areas of growth and targeted economic sectors that are currently underserved in the financial sector. The applicant must be able to bring in the requisite expertise, knowledge and technology to contribute constructively to the development of this specialised area of business in the financial sector.

The new commercial bank must be locally-incorporated in Malaysia and will be licensed under the Banking and Financial Institutions Act 1989. As a licensed commercial bank, the new bank must maintain a minimum capital funds that is unimpaired by losses of RM300 million at all times. In terms of foreign shareholding, the new commercial bank may have a foreign equity interest of up to 100%.

Submission of applications to Bank Negara Malaysia should be made by 31 October 2009. Successful applicants may commence operations in Malaysia in 2010.

New commercial banking licences

Up to three new commercial banking licences will be issued to qualified foreign players that are able to offer significant value propositions to Malaysia.

In assessing the merits of the applications, the following criteria will be adopted:

• The applicant must be a financially sound world-class foreign financial institution that has a strong reputation and track record;
• The applicant must be regulated and supervised by a competent home regulatory authority;
• The applicant must be supported by strong reputable shareholders that are able to provide sustainable support;
• The applicant must demonstrate, through a comprehensive business plan, that the new commercial bank will have the expertise and resources that can contribute constructively to the development of the Malaysian financial sector and the economy of Malaysia; and
• The applicant must be able to contribute towards enhancing global interlinkages and facilitating international trade and investment flows between Malaysia and the rest of the world. In addition, the value propositions to Malaysia would include amongst others, strengthening Malaysia 's position as an international Islamic financial hub and as a shared services and outsourcing centre.

The new commercial bank must be locally-incorporated in Malaysia and will be licensed under the Banking and Financial Institutions Act 1989. The new commercial bank must maintain a minimum capital funds that is unimpaired by losses of RM300 million at all times. In terms of foreign shareholding, the new commercial bank may have a foreign equity interest of up to 100%.

Submission of applications to Bank Negara Malaysia should be made by 31 December 2009. Successful applicants may commence operations in Malaysia with effect from 1 January 2011.

Application forms may be obtained from Bank Negara Malaysia's website at www.bnm.gov.my. Further details may be obtained by contacting the following:

Director
Financial Sector Development Department
Bank Negara Malaysia
Jalan Dato' Onn
50480 Kuala Lumpur
Tel No: 2691 9885 or 2690 7593
Email: [email protected]

See also:

1. Application Form for a Commercial Bank Licence [Doc] [PDF]
2. Press Statement on Liberalisation of the Financial Sector
3. Press Statement on Issuance of New Commercial Banking Licences