ipl-logo

Banking In Malaysia Case Study

810 Words4 Pages

The term “Bank” has been defined in different ways. According to Walter Leaf, “A bank is a person or corporation which holds itself out to receive from the public, deposits payable on demand by cheque.” Besides that, under the Banking and Financial Institutions Act (BAFIA) 1989, a “bank” is defined as “a person which carries on banking business”. Commercial banks are a financial institution based on trade funds, craft their basic as they act as a medium between investment and capital. The main player in the banking system and it is the largest and most crucial provider of funds in the banking system is commercial banks. According to Muhamad Muda (1996), the history of Malaysian banking development dates back to more than 130 years ago when the first commercial bank which is the Chartered Mercantile Bank of India, London and China was established in 1859. In July 1913, Kwong Yik (Selangor) Banking Corporation was the first domestic bank in Malaysia. Commercial Bank, finance companies and merchant banks is the early financial structure of Malaysia. On 24 January 1959, the Central Bank which is Bank Negara Malaysia was established under the Central Bank of Malaya Ordinance, 1958 and Bank Negara …show more content…

The economic downturns in year 1985 in the developed countries are affected by the U.S. high interest rate policy and it causes a large crumble of commodity trade in the world. Due to this, the export price index in Malaysia is affected by decreased by 30%. Economic downturn make the local commercial banks faced the highest non-performing loans which is 17.8% of the overall loans. Asia Financial Crisis in July 1997 was happened due to the floating of the Thai bath and it made the economics of Malaysia slightly raised doubt that it would perish to a Thai financial

Show More
Related

  • The Federal Reserve: The Global Financial Crisis

    1132 Words  | 5 Pages

    The global financial crisis, which emerged in 2007, was the result of the expansion of banks and financial markets in Western countries, completely independent of the real economy, with no close monitoring of the performance of these financial institutions. The crisis has caused losses to global financial institutions, It is difficult to pinpoint all the reasons behind the crisis, including the fact that many financial institutions freeze the granting of loans to companies and individuals for fear of being difficult to recover. And the lack of liquidity in circulation of individuals and companies and financial institutions, and this led to a sharp contraction in economic activity and in all aspects of life, which led to the cessation of borrowers

    Read More

  • Cuban Imperialism: The Late 1970

    255 Words  | 2 Pages

    In late 1970, many oil distributing countries had large amounts of earned money which they put into Western banks. The Western banks later loaned this money to Third World countries for large expansion projects. Several factors emerged from this action. For example, world interest rates increased, global recession, and low commodity prices. Later which initiated the size of these debts to start growing fast and several countries began to fall behind in their payments.

    Read More

  • President Jackson's Policy Toward The Second Bank Of The United States

    1718 Words  | 7 Pages

    Banking system is essential in our economics to maintain an effective circulation of money. The bank has functions for regulation of currency to aid strong economy. Distribution of the money is crucial to promote construction of the nation and prevention of bankruptcies. In our modern economic structure is supported and developed by the banking system. However, there was a period that the national bank was shut down by the government the consequence of the bank war.

    Read More

  • 1970's Essay

    2448 Words  | 10 Pages

    First, Japanese industry had caught up with the best practices abroad; improving productivity required more resources than in the past. This in turn reduced the profitability of new investment, which fell to a lower level after 1974. The international environment also became less favorable, due mainly to the revaluation of the yen and trade frictions with the United States. The Japan¬ United States textile talks of 1969, a worldwide commodity price boom that culminated in the quadrupling of oil prices during the oil crisis of 1973, and the movement of the yen to a floating rate in 1973, all these factors worked to slow Japanese economic growth. Even before the October 1973 oil crisis, the government had started to slow the economy in response to rising inflation.

    Read More

  • Causes Of The Debt Crisis In The 1980s

    2045 Words  | 9 Pages

    The purpose of this essay is to examine the debt crisis that took place in the 1980s by assessing the role of the international bankers as well as the government’s role in both debtor and creditor nations. Once Mexico announced that they could not repay their debt, soon after countries such as Brazil and Argentina followed the same path, resulting in developing countries being faced with a debt crisis (Carmichael 1989, 121). Although majority of the outcomes were negative, surprisingly the debt crisis led to positive outcomes, for example secondary markets were established, industrial countries experienced low-inflationary growth and banks’ balance sheets in creditor nations were strengthened (Carmichael 1989, 121). This essay will not only address the causes and origins of the debt crisis in the 1980s, but more importantly draw attention to the ways in which this debt crisis may have been prevented. It is imperative to first define the debt crisis as well as to determine the origin and causes of the debt crisis in the 1980s before one can provide an explanation for the actions of the bankers and governments who were involved.

    Read More

  • Welfare Dependency: Social Disorganization Perspective

    1853 Words  | 8 Pages

    We can see the economy development in Hong Kong was quickly increase for around 2% per year. However, the Asia Financial Crisis have affected Hong Kong’s economy a lot. The Asia Financial Crisis was beginning in July 1997 it let Hong Kong’s GDP have decreased around 6%. Furthermore, the unemployment rate have increased about 5% in 1997-1998. There was around 70,000 people have lost their work.

    Read More

  • Gravity Model

    1387 Words  | 6 Pages

    Moreover,it was only major advanced country that experienced negative economic growth in 2008. Japan’s banks suffered less than banks in US since Japanese held much less debt than their counterparts in US.No major Japanese bank collapsed. Biggest hit was decrease in external demand. Drop in net exports was %11.8 declined. However, the US faced considerably less decline in demand rather than Japan.

    Read More

  • What Are The Effects Of The 2008 Financial Crisis

    180 Words  | 1 Pages

    The world has been through different financial crises in the past years, such as, “the economic downturn in the Japanese economy” and “the Asian financial crisis that occurred in the 1990”. Those major events has brought negative impacts to the economies of varies markets and regions. Therefore, the occurring of financial crises is very common and it will lead to economic losses to people and organizations (Viswanathan, 2010). The global Financial Crisis that occurred in the year 2008, has brought major effects to the world economies.

    Read More

  • 2007-08 Global Financial Crisis

    1560 Words  | 7 Pages

    About the cause of the 2007-08 Global Financial Crisis and the measures Along with the development of economic globalization, the world economies have closely linked. Therefore, 2007-08 financial crises made economies have suffered varying degrees of influence. This was a from the USA subprime mortgage crisis and once in a century financial crisis by Arup Shah (2013). Famous American investor, entrepreneur and philanthropist Warren Buffett (2008) claimed that“ the US economy is in recession and degree would be more serious than most people expected”.

    Read More

  • Pestel Analysis Of Banking Industry

    1748 Words  | 7 Pages

    (Appendix1 shows a complete list of banks in Malaysia). • Malaysian banking system is highly regulated/controlled by BNM and banking products are basically of similar/almost-identical nature. The tangible differentiation between competing banks is therefore minimal, as they have similar capability to market/sell their products, thus creating a very intense competition amongst all the players. • The industry has been around for a long time, and just about everyone who needs banking services already has them. Because of this, banks must attempt to lure clients away from competing banks e.g. by offering higher credit limit,

    Read More

  • How Did The Lehman Brothers Collapse

    1333 Words  | 6 Pages

    This will review any major and minor contributing factors that were factors in this crisis. Also, the reasoning will help to conclude to why this occurred. There were many countries directly and indirectly effected by the demise of the

    Read More

  • Transnational Financial Crisis

    1419 Words  | 6 Pages

    Starting in 1982 when Mexico announced that it would default on its bank debt, and moving through to the Asian Financial Crisis in 1997 and finally to the Global Financial Crisis in 2007, the biggest common issue appeared to be, at its simplest form, was too much money being loaned to too many. In Mexico, the International Monetary Fund, or IMF, offered new loans in exchange for cutbacks in state spending, however debtor states used this to refinance their old loans and extend repayment time. Another issue in this crises was somewhat of a “Catch 22” where all the banks knew they would be better off by clearing their books to reduce risk of debtors defaulting but no bank was willing to do so

    Read More

  • Financial Crisis Was The Main Cause Of The Great Depression

    1308 Words  | 6 Pages

    financial crisis is not a strange thing nowadays. It has been expanding and getting bigger on the geographical side and it reached the largest from 1929 to 1933. The world economy has from time to time been hit by crisis situations, and nowadays crisis is most presumably not the last one. Be that as it may, a few elements joined to make this one the most serious crisis since the Great Depression of the 1930s, including macroeconomic issues, disappointments in budgetary markets and weakness is obvious in applying the policies.

    Read More

  • Global Financial Crisis: The Subprime Mortgage Crisis

    1603 Words  | 7 Pages

    This clearly reflects the vulnerability of the Singapore economy which is highly dependent on trade, to external conditions and global economic shocks. Due to Singapore’s well regulated market, the exposure of Singapore banks to subprime mortgage is limited. However the recession in is mainly caused by the fall of the non-oil exports in manufactured goods, which was greatly affected by the overall deteriorating economic conditions in U.S. and Europe. The Singaporean government also set aside US$406.2 million (S$600 million) for training and development of workers to improve its human capital.

    Read More

  • What Are The Causes Of Financial Crisis

    1461 Words  | 6 Pages

    Understanding Financial Crisis: Causes, Effect and Prevent measure To most ordinary people, Financial Crisis is a both familiar and unfamiliar topic. There is a range of definition of the Financial Crisis, but in general it is refers to the crisis of financial assets or financial markets or financial institutions. In fact, Financial Crisis is closely related to people’s life, 2007-2008 Global Financial Crisis attracted ordinary people to focus on the financial sector. This essay will argue the financial crisis of 2008 came from the US subprime crisis, which has brought enormous impact on the world economy, and in different societies, the countries have different prevent measures to cope with the crisis. For the aspect of cause, the US subprime

    Read More

More about Banking In Malaysia Case Study

Open Document