Malaysia banking system

According to Bank Negara Malaysia, Malaysia banking system is divided into 3 main groups which are; 1) monetary institution comprising the Central Bank (Bank Negara), commercial and Islamic financial institutions; 2) non- monetary institutions namely merchant banks, credit and insurance companies, and development banks; and 3) foreign banks representative offices and offshore banks. Prior to the 1997 financial crisis, Malaysia had thirty - seven commercial banks, forty finance companies and twelve merchant banks. However, after the financial crisis 1997, most of the banks has consolidation through mergers and acquisitions to strengthening of these financial institutions has result in thirty – five licensed commercial banks, thirty – one finance banks and twelve merchant banks. As to date, there are only twenty – two licensed commercial banks and fourteen merchant banks in Malaysia. (Shanthi Kandiah, 2009)