Chapter 5 Financial System of Malaysia

5.1 Financial System Structure in Malaysia

The Malaysian financial system is structured into two major categories, Financial Institutions and Financial Market. The Financial Institutions comprise Banking System and Non-bank Financial Intermediaries. The Financial Market in Malaysia comprises four major markets namely: Money & Foreign Exchange Market, Capital Market, Derivatives Market, and Offshore Market.

Chart 1: The Financial System Structure in Malaysia

Financial Institutions

Financial Market

Financial System

Banking System

1. Bank Negara Malaysia

2. Banking Institutions

• Commercial Banks

• Finance Companies

• Merchant Banks

• Islamic Banks

3. Others

• Discount Houses

• Representative Offices of Foreign Banks

Non-Bank Financial Intermediaries

1. Provident and Pension Funds

2. Insurance Companies (including Takaful)

3. Development Finance Institutions

4. Savings Institutions

• National Savings Bank

• Co-operative Societies

5. Others

• Unit Trusts

• Pilgrims Fund Board

• Housing Credit Institutions

• Cagamas Berhad

• Credit Guarantee Corporation

• Leasing Companies

• Factoring Companies

• Venture Capital Companies

Capital Market

1. Equity Market

2. Bond Market

• Public Debt Securities

• PrivateDebtSecurities

Money & Foreign Exchange Market

1. Money Market

2. Foreign Exchange Market

Derivatives Market

1. Commodity Futures

2. KLSE CI Futures

3. KLIBOR Futures

Offshore