KUALA LUMPUR, Dec 8 ― Local banks are not gaining from financial regulators' move to make exporters convert 75 per cent of their foreign earnings to ringgit, said the Association of Banks in Malaysia (ABM).
Rejecting allegations that its members were profiting from the policy, it added that customers also have the freedom to take their patronage elsewhere if any banks were not competitive in terms of service or prices.
It also voiced its support for Bank Negara Malaysia's move that has been criticised by some exporters.
“The measures taken to stabilise the ringgit is for the longer term development of the onshore
market and will result in less volatility of the ringgit against major currencies, especially against the US dollar, which is presently the main currency for the country’s trade.
“The action taken would benefit manufactures and traders in the long term as they would not be distracted by the exchange rate volatility,” ABIM said in a statement.
BNM came up with the new foreign exchange policy after the ringgit fell against major world currencies.
The currency, already suffering due to dropping crude oil prices since 2014, took a further hit following speculation that the US may raise its interest rates, prompting bond holders to divest some of their holdings elsewhere in anticipation of such a move.
