KUALA LUMPUR: RAM Rating Services Bhd believes the statutory reserve requirement (SRR) for banks may rise to 4%, as Bank Negara Malaysia (BNM) is expected to take a proactive stance on managing the financial system's liquidity.
RAM Ratings, the agency's financial institution ratings head Promod Dass said on Monday, March 21 that BNM could raise the SRR to 4% eventually, which is the level seen pre-2008 financial crisis.
"We think raising the SRR is merely normalising the liquidity levels of the banking system, as the SRR is at an all-time low currently," he said at a media briefing on the banking outlook.
The SRR was lowered to 1% in March 2009 to boost the lending environment during the financial crisis. However, BNM had announced that the SRR would be increased to 2% effective April.
RAM Ratings, the agency's financial institution ratings head Promod Dass said on Monday, March 21 that BNM could raise the SRR to 4% eventually, which is the level seen pre-2008 financial crisis.
"We think raising the SRR is merely normalising the liquidity levels of the banking system, as the SRR is at an all-time low currently," he said at a media briefing on the banking outlook.
The SRR was lowered to 1% in March 2009 to boost the lending environment during the financial crisis. However, BNM had announced that the SRR would be increased to 2% effective April.
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