From The Report: Malaysia 2014
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In a stress test conducted in early 2014, the central bank found that Malaysia’s banks would be able to hold up even if the system faced shocks greater than those in the 2008 crisis. After a number of years of consolidation and in an environment of tight regulation, Malaysia’s commercial banks have continued to improve. Local banks have been ordered by Bank Negara to increase their collective assessment ratio to 1.2% by the end of 2015. The ratio was previously called the general provisions ratio and was set at 1.5%. Macroprudential measures will help the country get its household debt under control while small and medium-sized enterprise financing is likely to improve over time. The vision of creating a regional banking giant remains unfulfilled for the time being; nevertheless, organic growth opportunities exist and banking targets may become available from time to time, allowing some of Malaysia’s larger players to cobble together a regional footprint. This chapter contains an interview with Kelee Kam, Group Managing Director, RHB Capital.