The Malaysian economy registered commendable growth in 2024, along with moderate inflation. This was achieved despite significant challenges and opportunities, and continued episodes of heightened global financial market volatility throughout the year. These were influenced by shifting expectations on movements in global interest rates, lingering concerns over inflationary pressures and intensification of geopolitical tensions. Naturally, these global developments have had spillovers to Malaysia. However, having entered this episode from a position of strength, the economy was able to absorb these shocks. The impact on domestic economic and financial conditions have been contained. This has also enabled Malaysia to continue advancing critical structural reforms to fortify its resilience and lift its prospects.
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Bank Negara Malaysia (BNM) is Malaysia’s central bank. Our principal objective is to promote monetary stability and financial stability conducive to the sustainable growth of the Malaysian economy. BNM derives its mandate and powers from the Central Bank of Malaysia Act 2009 and other laws that it administers.1
In our role to promote monetary stability, BNM formulates and conducts monetary policy to keep inflation low and stable, while ensuring that it is supportive of sustainable economic growth. We are also mandated to promote an exchange rate regime consistent with the fundamentals of the economy.
To promote financial stability, BNM regulates and supervises financial institutions to promote their safety and soundness. We oversee money and foreign exchange markets to promote their integrity and orderly functioning. We also exercise oversight over payment systems to foster safe, efficient and reliable payment systems and payment instruments. In addition, we regulate the conduct of financial institutions and intermediaries in order to provide appropriate protection to financial consumers.
BNM plays a key role in promoting a progressive and inclusive financial system. This takes into account the changing needs of the Malaysian economy and its people, and the central role of finance in the nation’s economic and social progress. Our pursuit to develop and deepen both the conventional and Islamic financial system also recognises that a well-developed financial system is one that can help absorb shocks, and therefore contributes to the country’s resilience.
BNM carries out a number of other important functions. These include issuing currency, and holding and managing the country’s foreign reserves. BNM is also the financial adviser, banker and financial agent of the Government. Together with other government and law enforcement agencies, we play a role in helping to prevent the criminal abuse of financial services. Additionally, BNM has been responding to climate risk, firstly through appropriate regulation and supervision of financial institutions, to support an orderly transition to a low-carbon economy; and secondly by embedding sustainable practices in our own operations.
In all BNM does, it does in the best interest of the nation.
Bank Negara Malaysia’s Monetary Policy Committee (MPC) is responsible for setting monetary policy in Malaysia to maintain price stability while giving due regard to economic developments.1 To achieve this goal, the MPC meets at least six times a year to regularly assess Malaysia’s economic and inflation prospects, and decide on the Overnight Policy Rate (OPR).
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Apart from monetary stability, Bank Negara Malaysia (BNM) is mandated to promote financial stability conducive to the sustainable growth of the economy. We discharge this mandate by ensuring that the financial system is resilient and able to withstand shocks throughout economic cycles. This involves promoting strong and well-managed financial institutions. It also includes fostering safe and reliable clearing and settlement systems, and maintaining orderly f inancial markets.
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Bank Negara Malaysia continued to foster a progressive and inclusive financial system in line with the desired outcomes of the Financial Sector Blueprint 2022–2026.
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During the year, we focused on elevating Islamic finance’s role and impact towards promoting sustainable economic growth and enhancing social justice.
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BNM is committed to ensuring that payment systems remain safe, efficient and responsive to evolving needs of Malaysians.
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BNM is the sole issuer of ringgit banknotes and coins, the only legal tender in Malaysia. BNM’s mandate is to ensure that there is sufficient supply of ringgit banknotes and coins to meet public demand and maintain the quality and integrity of currency in circulation (CIC).
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Bank Negara Malaysia (BNM) continues to enhance efforts to combat financial crimes by strengthening compliance with international standards, optimising technology and widening stakeholder collaboration in implementing mitigation strategies
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Bank Negara Malaysia (BNM) continues to nurture and develop its people to ensure the delivery of our mandates with high standards of excellence and professionalism.
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The financial sector is a key enabler to Malaysia’s just and orderly transition. With a robust ecosystem largely in place, efforts have been intensified to translate policies into actionable steps. Focus was accorded to climate disclosure, development of climate finance solutions, enhancing data accessibility and capacity-building to unlock growth opportunities to support sustainable development. These efforts are beginning to yield progressive outcomes, reinforcing the financial sector’s role in fostering a resilient and sustainable economy.
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Bank Negara Malaysia (BNM) is exposed to various risks arising from its daily activities and operations. Risk events, should they occur, may impede BNM from achieving its policy objectives, create f inancial losses or business disruptions, and in turn lead to adverse impacts on BNM’s reputation. To address this, BNM implements the Enterprise Risk Management (ERM) Framework.
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Our policies and actions affect all parts of society in Malaysia. We, therefore, engage stakeholders widely to enhance their understanding of our roles and policie.
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In 2024, Bank Negara Malaysia (BNM) intensified our international engagements to support BNM’s mandates and advance our strategic interests. Throughout the year, we achieved significant milestones across different platforms. These reaffirmed BNM’s position as an active partner in strengthening cooperation and deepening financial integration both regionally and globally. These efforts were also critical in laying the foundation for Malaysia’s ASEAN 2025 Chairmanship.
More on international engagementsThe governance arrangements of Bank Negara Malaysia (BNM) ensure that we continue to effectively discharge our mandates to promote monetary and financial stability conducive to the sustainable growth of the Malaysian economy. These arrangements are set out by statute in the Central Bank of Malaysia Act 2009 (CBA) and other laws that BNM administers, and internal policies developed over the years. Our governance framework continues to be aligned with global best practices and industry standards.
Under the CBA, the Board of Directors is responsible for overseeing the management and operations of BNM. This is to ensure that we deliver our mandates and remain financially and operationally sound, and our resources are utilised effectively and efficiently.
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The Board is supported by three committees – the Board Governance Committee, the Board Audit Committee and the Board Risk Committee. These committees consist only of Independent Non-Executive Members. Each committee is governed by its own Terms of Reference that is intended to support the Board and provide internal checks and balances on the management and operations of BNM.
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As provided by the Central Bank of Malaysia Act 2009, the Governor is responsible for the management of BNM in discharging its mandates. In performing these duties, the Governor is assisted by a senior management team consisting of Deputy and Assistant Governors. BNM’s organisation structure is designed to promote clear lines of reporting and accountability across its wide-ranging functions.
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In certain areas, the responsibility for decision-making is placed beyond the direct remit of the Board or Management. These matters are reserved for specific organs created by statute.
More on Statutory CommitteesBank Negara Malaysia (BNM) supports its day-to-day operations from income generated from the investments of the country’s international reserves and other general operations of BNM. In doing so, we are committed to being responsible, prudent and disciplined in managing our finances to ensure that we have sufficient financial resources to discharge our mandates effectively.
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