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Bank Negara Malaysia Case Study

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Introduction
Financial services industry provides the services and products to customers and businesses such as bank, insurance companies and investment companies all of which comprise the financial services industry.
Commercial banking is the one of the important components in the sector of financial services industry. It has experienced massive consolidation since 1980. Mergers are able to diversify risk, reduce cost, pool the resources, expand the market share, and maintain the stability of financial system. In Malaysia, Bank Negara Malaysia launches the merge program in order to achieve a more competitive and effective banking system. 50 banking institution have been consolidated into 10 banking groups at 31st December 2000. But bank merge will cause the problems of risk and compliance culture. For the purpose of overcoming the problems, there are many acts exists for example Financial Services Act 2013 (FSA) is used to regulatory and supervisory entered into a new stage of its development (Administered Legislation, n.d.).
Malaysia financial system is structured by banking system and non-bank financial intermediaries. During 1985-1986, banking institutions also suffer in higher level of non-performing loan. In order to cover the loss, BNM establish a rescue scheme to maintain the stability of the financial system. The rescue scheme is merge the finance company and commercial bank, the number of the finance company decrease from 47 to 40. Besides, financial crisis and

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