Cash services - Malaysia

18.11.2019

Cash payments - restrictions on cash instructions

Incoming funds

Incoming MYR (other than income or corporate action proceeds resulting from securities positions held with Clearstream Banking) must always be pre-advised.

Withdrawals of funds

Withdrawals of MYR are restricted to:

  • No change of beneficial owner;
  • Payments linked to securities-related transactions where these securities will be held with Clearstream Banking.

For withdrawals not involving a change of beneficial owner (own account transfers), customers must input the wording “NCBO-<reason>" in the narrative of the withdrawal instruction, for example, “NCBO-Asset transition”.

For withdrawals related to payments linked to securities-related transactions, where these securities will be held with Clearstream Banking, customers must state the reason for payment in the narrative of the instruction, for example, “Purchase of x XYZ Shares”.

HSBC Bank might require further documentary proof that no change of beneficial owner is applicable or that the payments relate to an underlying legally valid reason. In this event, Clearstream Banking will contact the customer directly.

Clearstream Banking shall bear no responsibility for any misuse of the “no change of beneficial owner” designation in contravention of Malaysian regulations. Furthermore, Clearstream Banking shall bear no responsibility for any failure or delay in the execution of the payment instruction due to incorrect or missing information.

Holding restrictions of funds

Clearstream Banking’s MYR account is designated as a “foreign” cash account. Cash belonging to Malaysian residents must be transferred out within three days from credit date. Customers are responsible for ensuring compliance with these restrictions and agree to indemnify and hold harmless, Clearstream Banking for any loss, expense, liability, damage or claims, whether direct or indirect, against or incurred by Clearstream Banking arising out of or resulting from such non-compliance.

Foreign exchange

Foreign exchange services for MYR are available to customers as an integral part of Clearstream Banking’s Automatic FX service, the case-by-case and the FX service for securities settlement instructions. In compliance with Malaysian regulatory requirements, the MYR currency on customers’ instructions can be used only to purchase Malaysian securities or to cover charges incurred in MYR. Accordingly, customers’ instructions with MYR as the Buy currency are deemed by Clearstream Banking to comply with these regulatory requirements.

Customers that need to buy MYR in order to settle a securities purchase (where these securities will be held in Clearstream Banking) from a Malaysian domestic counterparty are recommended to use the FX service for securities settlement instructions. To purchase MYR on a case-by-case basis, customers should instruct Clearstream Banking’s Treasury Desk directly.

Note: Before participating in any foreign exchange services for MYR with Clearstream Banking, customers are required to submit the following one-time SWIFT MT599 free-format message to the Clearstream Banking Treasury Desk. (One MT599 for multiple accounts can be accepted provided that all the accounts belong to the same entity.)

"Attn: Clearstream Banking Treasury Desk

Clearstream Account Number(s):

We, (entity name), hereby unconditionally represent and warrant that we do not and will not conduct or transact in any offshore MYR non-deliverable forwards and / or offshore MYR foreign exchange derivatives contracts, as well as any future product of financial instruments of similar substance.

We, (entity name), agree to indemnify Clearstream Banking and to hold Clearstream Banking harmless for any claims, fines, penalties, damages or losses, whether direct or indirect, resulting from an untrue, incomplete or inaccurate representation."

Once the message is received and recorded by the Clearstream Banking Treasury Desk, the Foreign Exchange service will be activated on the given account(s).