Learning Topics

•    Pre-test (20 questions)
•    Introduction and overview of Foreign Exchange Administration Rules and it’s policy               framework in managing balance of payments and value of Ringgit
•    How normal are foreign exchange control?
•    Schedule 14 of Financial Services Act (FSA)
•    Reserve and liquidity management and explanation on the regulatory system to channel        back inflows and to control outflows
•    Safeguarding the balance of payment position & safeguarding against speculation of the       Ringgit
•    Definitions and terminologies used in FEA Notices
•    Series of measures by BNM aim at developing the onshore financial markets

​

Foreign Exchange Administration Notices 

Notice 1 – Dealings in Currency, Gold and Other Precious Metals
•    New measures with effective from 5th December 2016
•    Dynamic Hedging
•    Resident & Non-resident institutional investor
•    Hedging without documentary evidence
•    Dealings by residents/non-residents through Appointed Overseas Office (AOO)
•    Dealings in Gold
•    Hedging Flexibilities including Active Hedging
•    Specific operational requirements & Directive to FI’s

Notice 2 – Borrowing and Guarantee
•    Limits on borrowings and guarantees for residents and non-residents
•    Financial Guarantee & Non-Financial Guarantee
•    Credit terms vs. Payment Guarantee
•    Application of rules for Notice 2 on borrowings and guarantees
•    Approval from BNM on borrowing from non-resident bank?
•    Borrowing from parent company
•    Setting up of Labuan office to borrow loan
•    Group Case Study discussion
•    Common reasons for cases of non-compliance

​

Notice 3 – Investment in Foreign Currency Asset
•    Prudential limits on investment onshore and abroad for residents
•    Case study on trade and investment foreign currency account with a licensed onshore            bank
•    Application of rules for Notice 3 
•    Group discussion on bank’s precautionary measures prior to effecting payment abroad         for purpose of investment by residents

Notice 4 – Payments
•    Schedule 14, Financial Services Act
•    Payment/Receipt in Ringgit
•    Operations of External Accounts
•    Payment/Receipt in foreign currency
•    Group discussion on external account holder obtaining Ringgit facilities from a resident          entity
•    Common reasons for cases of non-compliance
•    Directions to financial institutions

​

Notice 5 - Security, Islamic Security, Financial Instrument or Islamic Financial Instrument
•    Issuance of securities & financial instruments including transfer of securities

​

Notice 6 – Import & Export of Currency
•    Limits on import & export of foreign currency & Ringgit

​

Notice 7 - Export of Goods
•    Revised definition of exports
•    New measures with effective from 05th December 2016 on export proceeds
•    Reconversion
•    Specific operational requirements for Notice 7 
•    Group discussion on various financing on domestic and international trade.

 

Dealings with Specified Persons and in Restricted Currencies
•    Definitions of specified person and in restricted currencies

 

Directions to Financial Institutions
•    External account
•    Opening and maintaining account
•    Opening and maintaining account (Non-Resident)
•    General Operational Requirements
•    Establish internal control and procedures to ensure compliance

​

Specific Operational Requirements
•    FX contracts involving Ringgit using reference rate
•    Sighting of documentary evidence for forward contracts 
•    Sighting of documentary evidence before maturity date of forward contract 
•    Designation of external account 

​

Post-Test (20 Questions) / Questions & Answers Session