FIN 263-Banking Operation

Chapter 1: Banking System

Introduction To The Financial System.
Malaysian Financial Institutions.

• Banking System .
  -under the control and supervision of the BNM( Bank Negara Malaysia)
  -comprising commercial banks,investment banks and Islamic bank is the primary mobilizer of funds and the main source of financing which support economic activities in Malaysia.
  
  The Malaysian banking system divided by two categories.
  i) the monetary institutions.
• - the institution whose principal liabilities are generally accepted as money.
• e.g: BNM the sole currency issuing authority in the country and commercial banks(including islamic  banks) as the only institutions allowed to operate current accounts.
  
  ii)non-monetary institutions.
• -are the institutions that are linked closely to the monetary institution and whose liabilities are generally accepted as near money.

• Non bank Financial Intermediaries.
  - are the institution that are supervised by various government departments and agencies.
  Institution Involved:
  i)the development finance institutions.
  ii) the saving institutions.
  iii) the provident and pension funds.
  iv) the insurance companies and takaful operators,complement the banking institution in mobilizing savings and meeting the financial needs of the economy.(under supervised BNM)
  v) The unit trust.
  vi) The Gredit Guarantee Corporation (CGC)

Financial Markets.