KL to amend foreign bank laws

KL to amend foreign bank laws

KUALA LUMPUR (AFP): Malaysia Saturday announced it was amending the laws so as to allow foreign-owned financial institutions to operate in the country, a move that was immediately welcomed by China.

Malaysia's Deputy Finance Minister Wong See Wah said the institutions would have to get written approvals from the Finance Minister under the proposed changes to the Banking and Financial Institutions Act, 1989.

"The amendments have been approved by cabinet last week and will be presented at the current parliament session," Wong was quoted by Bernama news agency as saying. However, he did not give details of the amendments.

Wong was speaking to reporters after witnessing the signing of an agreement between Malaysia's Hai-O Enterprise Bhd. and China's Hi-Tech Industries Import and Export Corp. to set up a joint- venture company.

China's Economic and Trade Counselor in Kuala Lumpur, Zhu Xiachuan, who was present at the ceremony, described the move to allow foreign banks to operate in Malaysia as positive.

"We appreciate this quick action by the government as this will enable the Bank of China to open its branch here fast," Zhu said.

Malaysia's top bank, Malaysian Banking Bhd. as well as Public Bank Bhd. have representative offices in China.

The Banking and Financial Institutions Act, 1989 -- which replaced the Banking Act 1973 and the Finance Companies Act 1969 -- had required all branches of foreign financial institutions to be locally incorporated within five years after it came into effect.