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Policy Document on Statutory Reserve Requirement

Release Date: 15 May 2020

Title

Statutory Reserve Requirement

Effective Date

January 1959. This document was last updated on 15 May 2020.

Applicability

  1. FSA
  2. IFSA

Summary

The policy document sets out the requirements for the maintenance of balances by banking institutions in their statutory reserve accounts (SRAs) with Bank Negara Malaysia. Banking institutions are required to maintain balances in their SRAs equivalent to a proportion of their eligible liabilities as prescribed in the policy document.

Highlights

Highlights of the 15 May 2020 update

Effective 16 May 2020, banking institutions are allowed to use Malaysian Government Securities (MGS) and Malaysian Government Investment Issues (MGII) to fully meet the SRR compliance (refer to Appendix 3). This flexibility is available until 31 May 2021.

Highlights of the 27 March 2020 update

Footnote 3 has been updated to reflect that the daily variation band shall be 2.4% − 3.6% for the period 16th to 19th March 2020, and 1.6% − 2.4% from 20th March 2020 onwards. Appendix 3 has been updated to provide additional clarity on the temporary flexibility accorded to Principal Dealers and Islamic Principal Dealers.

Issuing Department

Prudential Financial Policy Department


 

Further details can be found in the following policy document:

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