Malaysia, Indonesia, Thailand rope in more banks for local currency settlement

KUALA LUMPUR (Aug 5): Central banks of Malaysia, Indonesia and Thailand have appointed more commercial banks to participate in the local currency transaction framework.
The banks, known as Appointed Cross-Currency Dealers, will facilitate cross-border settlement of trade and investment between the respective countries, Bank Negara Malaysia (BNM), Bank Indonesia, and Bank of Thailand said in a joint statement on Tuesday.
“The expanded network will strengthen customer outreach, enhance market access to local currency liquidity, [and] provide businesses with enhanced options for cross-border transactions between Malaysia, Indonesia and Thailand,” the statement read.
AmBank (M) Bhd, Bank of China (Malaysia) Bhd, OCBC Bank Malaysia Bhd, Standard Chartered Bank Malaysia Bhd, and Sumitomo Mitsui Banking Corporation Malaysia Bhd were appointed to handle ringgit-rupiah transactions.
In Indonesia, PT Bank Danamon Indonesia Tbk, PT Bank OCBC NISP Tbk, PT Bank Pembangunan Daerah Jawa Timur Tbk, and Bank of China (Hong Kong) Ltd Jakarta branch were appointed.
AmBank (M) Bhd, Bank of China (Malaysia), Hong Leong Bank Bhd (KL:HLBANK), OCBC Bank Malaysia, Sumitomo Mitsui Banking Corporation Malaysia, and Bank of China (Thai) Public Company Ltd will deal with ringgit-baht settlements.
For rupiah-baht transactions, PT Bank OCBC NISP, Bank of China (Hong Kong) Ltd Jakarta branch, and Bank of China (Thai) Public Company Ltd were the appointed dealers.
The latest initiative follows enhancements to the framework announced on Feb 17, including the adoption of harmonised operational guidelines, and the expansion of eligible cross-border transactions under the framework.
BNM, Bank Indonesia, and Bank of Thailand will “continue to support trade and investment growth through closer financial collaboration” under the framework, the central banks added.
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