For policy no.1, prior to 1 April 2007, licensed onshore banks like Standard Chartered were granted specific aggregate overnight limit for foreign currency accounts maintained by resident customers.
With the liberalisation, the overnight limit of licensed onshore banks for foreign currency accounts maintained by resident customers is abolished.
For policy no.2, before the liberalization, resident customers with domestic borrowings who wanted to invest in foreign currency assets were only allowed to convert up to a maximum of RM100,000 in aggregate per calendar year for such investment. If purpose of opening the foreign currency account was for education, the cap was at USD 150,000, regardless of resident customers with/without domestic borrowings.
With the liberalisation, resident customers with domestic borrowings now have the opportunity to invest more in foreign currency assets as the previous limit of RM 100,000 has been increased to RM 1 million in aggregate per calendar year. The cap of USD 150,000 for education purpose remains for resident customers with domestic borrowings.
Further, resident customers are now allowed to open and maintain joint foreign currency accounts for any purpose.
As for policy no. 3, previously, joint accounts between residents were only allowed if it was meant for either education / employment abroad. Joint accounts for any other reasons were not permitted, except with the prior approval from the Controller. Following the liberalisation,
joint accounts between resident customers can now be
opened for any purpose without having to obtain prior
approval from the Controller.
Policy no. 4 states that a resident customer was allowed to hedge foreign currency loan repayments only up to 24 months’ commitment. However, with the liberalisation
resident customers can hedge the foreign currency loan repayment up to the full commitment of the loans.
In policy no. 5, a resident customer who wanted to make foreign currency payments to another resident customer was first required to obtain prior permission of the Controller.
With the liberalisation, payments in foreign currency
between residents is allowed for settlement of foreign currency products offered onshore, without the need
to obtain prior approval of the Controller.
For policy no. 6, a non-resident customer was allowed only up to a maximum of 3 credit facilities from residents to finance the purchase / construction of residential / commercial properties in Malaysia. With the liberalisation,
non-resident customers are now free to obtain any number
of credit facilities from residents to finance the purchase / construction of residential / commercial properties in Malaysia.