Zafrul: Malaysian capital markets to remain open during Covid-19-driven MCO, emergency

Zafrul: Malaysian capital markets to remain open during Covid-19-driven MCO, emergency
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KUALA LUMPUR (Jan 12): Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said today Malaysian capital markets will remain open to support and facilitate fundraising, trading and investment, with all regulatory functions in place throughout the Movement Control Order (MCO), Conditional Movement Control Order (CMCO) and Recovery Movement Control Order (RMCO) and the Emergency Ordinance period as the nation contends against the Covid-19 pandemic.

In a statement today, Tengku Zafrul said the continued operations of the capital markets are important to support the resilience and recovery of the Malaysian economy, as well as help investors manage their risks and opportunities during this period.

"I would also like to highlight that Malaysia has a resilient capital market ecosystem, supported by ample liquidity. There are proper market management measures in place to manage volatility. Clearing funds, margins and deposits arrangements are also in place to manage clearing and settlement risks. The Securities Commission Malaysia together with Bursa Malaysia will continue to monitor the ongoing developments to proactively manage and mitigate risks in the marketplace, and will introduce additional precautionary measures, as appropriate.

"In terms of financial intermediation and payment systems, the operations of financial institutions and financial markets will continue as usual, with services remaining available and accessible to borrowers. Bank Negara Malaysia continues to actively monitor conditions in the financial markets to ensure that there is sufficient liquidity in the foreign exchange, bond and money markets; and that market conditions remain orderly. 

"Malaysia’s banking system buffers and sound risk management practices are able to mitigate the impact of any potential deterioration on credit quality and continue to support lending by banks to the economy during the duration of this Emergency Ordinance and various forms of MCO implementation,” Tengku Zafrul said.

Going forward, Tengku Zafrul said the government will continue to roll out measures under Budget 2021 to firmly place Malaysia on its recovery path in 2021 and that there is sufficient domestic liquidity to finance any additional fiscal stimulus to support lives, livelihoods and businesses, if necessary. 

In fact, the Ministry of Finance has begun considering various measures to support the people and businesses during this period, according to him.

"We will not compromise on the rakyat and businesses’ well-being. Malaysia’s sound economic fundamentals will continue to enable the government to respond effectively to the challenging environment, whilst maintaining economic growth and resilience," he said.

According to him, the government remains committed to building upon the current recovery momentum and ensuring long-term sustainability for both public finances and the economy.

Yesterday, it was reported that the government has reinstated the MCO in the states of Penang, Selangor, Melaka, Johor and Sabah as well as the federal territories of Kuala Lumpur, Putrajaya and Labuan for a two-week period starting tomorrow.

It was reported that in a national address yesterday, Prime Minister Tan Sri Muhyiddin Yassin said these states and federal territories are considered high-risk areas following a risk assessment as well as the evaluation of health services by the Ministry of Health.

Meanwhile, it was reported that the CMCO will be enforced in six other states — Pahang, Perak, Negeri Sembilan, Kedah, Terengganu and Kelantan — while Perlis and Sarawak will be under the RMCO during the same period.

Today, it was reported that Yang di-Pertuan Agong Al-Sultan Abdullah Ri'ayatuddin Al-Mustafa Billah Shah had proclaimed an emergency that will be enforced up to Aug 1, 2021 as a proactive measure to contain the Covid-19 pandemic in Malaysia.

It was reported that Comptroller of the Royal Household Datuk Ahmad Fadil Shamsuddin said in a statement today the King decreed that the emergency be in force up to that date, or until an earlier date if the number of Covid-19 cases in the country is effectively controlled and reduced.

Malaysia reported today a record high daily number of newly-confirmed Covid-19 infected individuals at 3,309, bringing the nation’s total number of Covid-19 cases to 141,533 so far, according to health director-general Tan Sri Dr Noor Hisham Abdullah.

Dr Noor Hisham said in a statement the country reported today four additional Covid-19-related deaths, which brought the nation’s cumulative number of fatalities due to the pandemic to 559 so far.

Chong Jin Hun