Thursday 28 Mar 2024
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KUALA LUMPUR (April 3): Malaysia’s external debt has gone up 2.3% to RM946.3 billion as at end-2019, or 62.6% of the country’s gross domestic product (GDP), compared with RM924.9 billion as at end-2018 or 63.9%. 

The higher amount is mainly due to the increases in non-resident holdings of domestic debt securities and deposits, and external loans by corporations.

However, the higher external debts were partially offset by the decrease in intercompany loans and interbank borrowings, according to Bank Negara Malaysia's (BNM) Economic and Monetary Review 2019 report.

BNM assured that the risks surrounding the external debt were well-contained given its favourable maturity and currency profiles, coupled with the central bank’s prudential and hedging requirements

As at end-2019, the external debt-at-risk for corporations and banks amounted to RM59.7 billion and RM67.7 billion, respectively. Cumulatively, these amounted to 13.5% of Malaysia’s total external debt and 30% of international reserves, according to BNM.

Furthermore, more than half of the outstanding external debt was of medium- and long-term tenures, with low rollover risk.

Meanwhile, BNM pointed out that almost one-third of the external debt was denominated in ringgit, and as such, is not affected by valuation changes arising from fluctuations in the exchange rate.

For more stories on BNM's annual report, click here.

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