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Malaysia central bank says will act on international banks trading ringgit in Singapore
[KUALA LUMPUR] Any international bank that has an operating license in Malaysia could face legal action if it facilitates ringgit futures trading on the Singapore Stock Exchange and the Intercontinental Exchange, Malaysia's central bank governor said on Friday.
Bank Negara Malaysia (BNM) Governor Muhammad Ibrahim said any ringgit transaction in Singapore involving a Malaysian client and a bank licensed in Malaysia will be subject to Malaysian law.
"The law specifically says that residents, which includes individuals and banks operating here, if they engage in any illegal activities in contravention with the Financial Services Act, we will take action," Mr Muhammad told a news conference.
Last week, BNM said in a statement that the introduction of ringgit futures on the Singapore and Intercontinental exchanges was inconsistent with Malaysia's policies.
In November last year, Bank Negara Malaysia (BNM) forced currency traders overseas to stop driving the ringgit lower and demanded that banks sign a commitment to cease trading the ringgit on the offshore non-deliverable forward (NDF) market.