KUALA LUMPUR: The central banks of Malaysia and the Philippines have signed a Declaration of Conclusion of Negotiations deal that paves way for banks from the respective territories to operate in each other's sovereign jurisdiction.
In a statement today, Bank Negara Malaysia (BNM) said it has signed a Declaration of Conclusion of Negotiations under the Asean Banking Integration Framework (ABIF) with Philippines' central bank Bangko Sentral ng Pilipinas.
BNM said the deal concludes the Heads of Agreement signed by both on March 14, 2016.
The negotiations cover issues such as the number of Qualified Asean Banks (QABs) to operate in each other’s countries, and the formation of presence and operational flexibilities in the scope of banking activities, branches and other forms of delivery channels.
BNM said that the deal represents commitments towards the Asean Framework Agreement on Services which will be inscribed in the respective countries’ Schedules of Specific Commitments, and will come into effect after each country’s domestic approval and ratification process.
"This is BNM’s second ABIF arrangement following the bilateral agreement with Otoritas Jasa Keuangan in August 2016, signifying Malaysia’s continuous commitment in deepening Asean financial integration.
"With the conclusion of the negotiations, both BNM and Bangko Sentral ng Pilipinas look forward to the presence of each other’s QABs to facilitate regional cross-border trade and investment," the statement said.
BNM governor Datuk Muhammad Ibrahim signed the Declaration of Conclusion of Negotiations with Bangko Sentral ng Pilipinas governor Amando M. Tetangco Jr at the sidelines of the 3rd Asean Finance Ministers’ and Governors’ Meeting in Mactan, Cebu Island, Philippines.