Malaysia’s financial market is open and easily accessible through its large network of Licensed Onshore Banks (LOB). Non-residents may also undertake FX transactions directly overseas via the Appointed Overseas Offices (AOO) of the licensed onshore banks.

A non-resident may undertake the following FX transactions via a LOB or an AOO:

FX Transaction for Own Account

• Buy or sell foreign currency (FC) against ringgit on spot basis for any purpose.
• Buy or sell FC against ringgit on forward basis based on underlying obligation such as ringgit bond holdings, equity holdings and net open position of palm oil futures. There is also no restriction to unwind or cancel the forward transaction for any underlying, except portfolio investment.

FX Transaction on Behalf

• A non-resident entity can enter into FX transaction involving ringgit (spot or forward basis) on behalf of its resident and non-resident related entity.
• A non-resident institutional investor (NRII), including custodian/trust bank, can enter into FX transaction on behalf of its non-resident clients. The NRII may also participate in the Dynamic Hedging Framework to actively manage its ringgit FX exposure.
• A non-resident financial institution can enter into FX transaction on behalf of its non-resident clients for settlement of international trade in goods or services with a resident.

Apart from FX transaction, any non-residents can transact ringgit-denominated plain vanilla interest rate derivative with licensed onshore bank or via its AOO without underlying.