Streamlined SRT process aims to optimize capital management while ensuring resilience The European Central Bank (ECB) is set to accelerate the approval process for Significant Risk Transfers (SRTs) , a move designed to improve capital efficiency for banks while maintaining financial stability. The ECB’s pilot program, scheduled to begin in early 2025 , will simplify procedures and reduce approval timelines, aligning with the growing demand for efficient capital allocation across European lenders. What’s Changing? The ECB, in collaboration with the European Banking Federation , is introducing a pilot program to shorten the SRT approval process. The notification period for SRT transactions will be reduced from three months to two weeks before deal finalization. The information submission requirements will be streamlined to ease regulatory burdens for banks. These changes are expected to make SRT transactions more attractive , all...
Fitch Ratings has reaffirmed Malaysia's sovereign credit rating at 'BBB+' with a stable outlook, reflecting the country's robust economic progress and improved political stability.
Key Highlights:
Positive Drivers:
- Strong Economic Growth: Malaysia’s economy grew by 5.3% in Q3 2024, driven by strong domestic demand and improved external performance.
- Fiscal Management: The Government targets reducing the fiscal deficit to 3.8% of GDP by 2025 (from 4.3% in 2024), through subsidy rationalisation and revenue optimisation.
- Continuous Current Account Surplus: Bolstered by foreign direct investments (FDIs), enhancing economic resilience.
- Governance Reforms: Strengthened under the Ekonomi MADANI framework, with initiatives like the Public Finance and Fiscal Responsibility Act 2023.
Government’s Commitment: Prime Minister Dato' Seri Anwar bin Ibrahim highlighted that the reaffirmation validates Malaysia's progress under the Ekonomi MADANI framework, which focuses on policy clarity, economic reforms, and fiscal discipline.
Outlook for 2025:
- Projected GDP growth: 4.5% - 5.5% under Budget 2025.
- Focus on structural reforms to create high-skilled jobs, boost competitiveness, and enhance national productivity.
- Continued fiscal consolidation efforts with targeted subsidy rationalisation, particularly for RON95 petrol.
International Recognition:
Fitch's assessment aligns with the IMF's endorsement of Malaysia’s reform agenda, which aims for inclusive growthand long-term stability.
Malaysia’s reaffirmed rating signals confidence in its policy direction and economic resilience, positioning the nation for sustainable growth amid global uncertainties.
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