"Bank Negara Malaysia just reduced the statutory reserve requirement (SRR) ratio from 4.00% to 3.50%, effective from Feb 1, to ensure sufficient liquidity in the domestic financial system. The SRR essentially is the amount of funds that commercial banks are required to keep with the central bank, interest-free, and is an instrument to manage liquidity, while the overnight policy rate (OPR) is the rate at which banks lend to each other."


Being so, we could put it as current market downturn, global economic slowdown, depreciating ringgit all contributes to this. Coupled with exceptionally high NPLs, banks, especially local ones are left with no choice but to increase FD interest rates to attract more people to bank in their money to keep their SRR ratio at a level as required by BNM.

Points taken. But the issue is Malaysians have a very bad habit of overspending way over their means and this will increase household debts. When people cannof repay their loans, NPL will be high and thus this will directly affect the reserve ratio.

Is not really a true Fd. Its partially investsment and no matter how stable that particular investsment company is the RM tells you, there would still be a risk of losing money or making zero profits.

Mach money box is your Mach account while savings account is conventional banking.

To give you a rough idea, with a Mach account, you can online transfer, ibg, bank in cash, bank in cheques to your money box. Its just like a conventional savings account with the exception it is an online virtual account where you can perform Fd placements, withdraw FD placements, etc without even needing go step foot in your respective banks.

Highest rates and medium term I guess. But I dont see any FD interest going over 4.5% for now.

Highest rates and medium term I guess. But I dont see any FD interest going over 4.5% for now.

Some argue that if you dont spend your money overseas, then MYR depreciating will not affect. I would disagree because price of goods and services will still go up, especially imported items.

This post has been edited by TOMEI-R: Jan 24 2016, 10:28 AM

Sorry TS. Noted.

I'd say this will depend on their collection for all loans, credit cards etc. If NPL keeps going up this year, Im sure they will come up with better rates for fd. But do bear in mind, when banks give out higher rates for FD, so do they charge more interests for loans.

This I agree. Before you even start to earn you already lose in exchange rates because banks exchange rates for foreign currencies are shitty. That is why a lot of Malaysians bring over cash to neighbouring Singapore to bank in. Bear in mind Singapore banks dont give interests for deposits.

Well this only applies to those buying property when/if property prices drop. For those who keep cash in FDs, when the country's economy worsens, so does the value of our currency.

Well both are good if you ask me. But then again, this is another topic.

I hope to see it happening too, though I dont think possible. Its means the economy and market is improving.

Yes, BNM will definately resort to lowering interest rates to boost local consumption to review the economy. But the issue is, how much can local consumption go around? The country's economy cant just demand on local consumption. This is only a short term effort by BNM which will not help much once there is not enough money to go around locally.

Outflowing of funds slowing down because there are not much to 'outflow' anymore. Market is bad. Everybody needs to have money to run their business, pay their debts etc. Foreigners especially O&G sectors have long left the country and withdrawn their funds in Malaysia back to their own country.

I dont agree loan demand will slow down. Malaysians, majority of them like to be in debt. Every persons needs a loan. Even for a handphone which costs a few hundred ringgit, they prefer to get an installment plan for it. But the issues lies in the willingness of the Banks to give out loans. NPL is at all time high, more and more people are sued for bankruptcy everyday. Borrrowers are saddled with many loans and bad credit records all contribute to banks being very stringent in giving out loans.

That is why I dont bother with these kind of banks.

This you have to wait till tomorrow when I access my Mach account and see if we can still place deposits for the promotional 4.5% interest rates.

Just login to my MACH account. The promotion 4.5% for six months FD has ended. It is not the on pull down list anymore. Too bad for those who missed the boat.


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Of course you can. This will be done by the bank you are putting your FD in. Don't split the banker cheque into 3 or you will end up paying for 3 banker cheques.

People are still keen to put fd. Issue is whenever banks have promotional rates. people rush to transfer over their fds from other banks. So their quotas fills up very quickly. That's what the HL Mach officer told me.

I wonder why people still bother with such banks anyway.