Accounting and Auditing Organization for Islamic Financial Institutions - an Islamic international autonomous non-profit making corporate body that issues accounting, auditing, governance, ethics and Shariah standards for Islamic financial institutions.
Asset Based Financing
Account Credit Facility
Automated Funds Transfer
Accountant General (Ministry of Finance, Government of Malaysia)
Association of Islamic Banking Institutions Malaysia
Al-Ijarah Thumma Al-Bai - a type of lease that concludes with an option to buy back in which the legal title of the leased asset will be passed to the lessee at the end of the lease period. AITAB technically comprises two contracts: an ijarah (leasing/renting) contract and then a bai (sale) contract.
Agensi Kaunseling dan Pengurusan Kredit
Agreement to lease
Asset-Liability (Management) Committee – which formulates, reviews and approves policies and strategies regarding the balance sheet structure, liquidity needs and trading activities.
Asset Liability Management
Advanced Measurement Approach (for Operational Risk specified in Basel II)
Anti-Money Laundering Act 2001
Anti Money Laundering and Anti-Terrorism Financing Act 2001
Anti-Money Laundering/Counter Financing of Terrorism
Agreement to purchase
Assets Under Management
Banker's Acceptance, a bill of exchange, drawn on and accepted by finance institutions on behalf of their clients, for trade financing. The tenure of financing ranges from 21 to 200 days. Banker's Acceptance is a discounting instrument and interest is paid up front by deducting from the principal amount. There are both conventional and Islamic Banker's Acceptance.
Banking and Financial Institutions Act 1989 - which lays out laws for licensing and regulation of financial institutions carrying out banking, finance, merchant banking, discount house and money-broking businesses.
Bai Bithaman Ajil - a common mode of Islamic financing used for property, vehicle, as well as financing of other consumer goods. Technically, this financing facility is based on the activities of buying and selling, i.e., the property that the customer wishes to purchase for example, are bought by the bank and sold to the customer at an agreed to price.
Basic Current Account
Business Continuity Plan
Branch Delivery System
Bank Guarantee - usually a written undertaking issued by a bank at a customer's request in favour of a third party (the beneficiary) guaranteeing payment in case of default.
Bank Guaranteed Bonds
Basic Indicator Approach (for Operational Risk specified in Basel II), or
Business Impact Analysis
Bulk Issuance of Cashier's Order Service
Bonds & Information Dissemination System (BNM)
Bank for International Settlements
Bank Pertanian Malaysia (Agriculture Bank of Malaysia) now known as AgroBank
Base Lending Rate - minimum interest rate calculated by banking institutions based on a formula which takes into account the institutions' cost of funds and other administrative costs.
Bank Negara Malaysia (Malaysia's Central Bank)
Basic Savings Account
Bank Simpanan Nasional (National Savings Bank)
Capital allowance (for Tax purposes)
Capital Adequacy Framework for Islamic Banks - Issued by BNM
Malaysian National Mortgage Corporation
Capital Adequacy Standard - issued by the Islamic Financial Services Board
Current Account and Savings Account
Current, Savings and Investment Account
Cross Currency Interest Rate Swap
Companies Commission of Malaysia
Customer Risk Rating
Central Credit Reference Information System, which is a computerised database system developed and maintained by the Credit Bureau to collect, process, store and generate credit information.
Credit Discretionary Limit
Cash Deposit Machine
Corporate Debt Restructuring Committee (BNM)
Central Depository System
Corporate and Investment Banking or Corporate and Institutional Banking
Customer Information File
Close of Business
Customer Profit Rate
Customer Relationship Management or Credit Risk Management
Cheque Truncation and Conversion System, which is a new facility introduced by Bank Negara Malaysia expected to be in full operation in 2009 for all cheque clearing processing replacing the SPICK cheque clearing system with the aim of improving the operational efficiency of the cheque clearing system, such as cheque clearance, whether local or outstation, within half a day (e.g. if a cheque is deposited after banking hours, it will be cleared by 2pm the next day).
Credit Tip Off Service Sdn Bhd (Malaysian version of Dun & Bradstreet)
Cash Threshold Reports (for AML)
Domestic Bills Exchange Purchased
Domestic Bills Exchange Purchased/Authority to Purchase
Documentary Credit (Trade Finance)
Development Financial Institutions
Domestic Input Financing
Domestic Output Financing
Discretionary Power or Domestic Purchase Order
Disaster Recovery Plan
Exposure at Default - A total value that the bank is exposed to the borrower at the time of default (specified in Basel II)
External Assets & Liabilities Information System - BNM's system to facilitate report on external assets & liabilities position of banking and non banking sector
Exchange Control of Malaysia (Exchange Control Rules from BNM)
Export Credit Refinancing (Trade Finance)
Export Credit Refinancing Islamic is a Pre-Shipment ECR facility based on Murabahah contract, granted to exporters to prepare goods prior to shipment.
Electronic Cheque Terminal
Electronic Documents Management System
Indirect Exporter Financing Scheme (an Islamic financing facility granted or a without recourse basis to the indirect exporters based on the contract of deferred payment sales as agreed with the direct exporters)
Electronic Funds Transfer
Europay-Mastercard-Visa - standards for chip-based payment cards and POS terminals/ATMs, for authenticating credit and debit card payment transactions.
Employees Provident Fund or KWSP
Fully Automated System for Tendering - BNM's automated system for tendering, bids submission and processing of tender for scriptless securities in the Malaysian debt securities market.
Financial Action Task Force (AML)
Foreign Bills Exchange Purchased
Foreign Bills Exchange Purchased/Authority to Purchase
Foreign Currency Accounts
Financing Collection System
Foreign Currency Demand Drafts
Facility Excess Application
Forward Exchange Contract - an agreement to buy or sell currencies at a future date (more than 2 trading days) at a predetermined price.
Financial Institutions Corporate Profile System - BNM's database on the profile of all banking institutions.
Fraud Information Database System - BNM's repository of all fraud and attempted fraud cases reported by the financial institutions, and frauds detected and investigated by BNM
Financial Intelligence System - BNM's reporting system developed to cater for submission of Suspicious Transaction Reports (STRs) and Cash Threshold Reports (CTRs) from reporting institutions.
Financial Information Statistical System (BNM)
Financial Mediation Board
Foreign Bills of Collection
Foreign (currency) exchange or FX
Financial Origination System
Financial Process Exchange (facility for payment or transfer of funds via the Internet provided by MEPS)
Forward Rate Agreement - a contractual agreement between two parties to fix the rate of interest for a future period on a specified notional principal, such as a loan or deposit. A FRA is used to hedge an asset or liability. It is also a widely used instrument for investment, trading and arbitraging.
Facility Risk Rating
Financial Reporting Standards - issued by the Malaysian Accounting Standards Board
Financial Sector Master Plan (issued by BNM)
Funds Transfer Pricing
Foreign Currency Telegraphic Transfer
Foreign Worker Telegraphic Transfer
Foreign (currency) exchange or FOREX
General Investment Account
Government Linked Company
“Guidelines on the Credit Limit to a Single Customer" (BNM)
Islamic Acceptance Bills
Islamic Banking Act 1983
Institut Bank-Bank Malaysia (Institute of Bankers Malaysia)
Islamic Banking and Finance Institute Malaysia Sdn. Bhd.
Interbank GIRO - An electronic funds transfer payment system for interbank payments up to a maximum of RM100,000 per transaction via MEPS
Islamic Banking Institutions
Inward Bill Collection (Trade Finance)
Inward Cheque Clearing System (SPICK) - replaced by CTCS in 2008
Islamic Commercial Papers
Irredeemable Convertible Unsecured Loan Stock
Islamic Development Bank
IECR Domestic Purchase Order
International Financial Reporting Standards
Islamic Financial Services Board
International Islamic Bank
International Islamic Financial Market
Islamic Interbank Money Market
Interest in suspense
Inward Letter of Credit
Ijarah Muntahia Bittamleek
International Offshore Financial Centre
Income-producing Real Estate
Islamic Profit Rate Swap
Internal Ratings Based Approach (for Credit Risk specified in Basel II)
Internal Ratings Based (Advanced) approach for Credit Risk specified in Basel II
Internal Ratings Based (Foundation) approach for Credit Risk specified in Basel II
Investment Risk Reserve, or
Internal Rate of Return
Interest Rate Swap. IRS transaction is a contract between two parties to exchange interest rate payments (cash flows) at a future date. It allows the flexibility to convert a fixed rate asset/liability to a floating rate asset/liability and vice versa. There are basically two types of swaps which are traded daily by most markets - interest rate swaps (IRS) and currency swaps.
Standard used to define the interface file format used for financial transaction messages
International Standby Practices 1988 (Trade Finance)
International Transactions and External Position System - BNM's database comprising detailed information on the payments and receipts between residents and non-residents effected through the banking system
International Transactions Information System - the balance of payment module of the ITEPS (BNM)
Interactive Voice Response - a phone technology that allows a computer to detect voice and touch tones using a normal phone call
Jabatan Akauntan Negara Malaysia (Accountant General)
Kuala Lumpur Inter Bank Offered Rate
Kumpulan Wang Simpanan Perkerja or Employees Provident Fund
Know Your Customer (Policy) required under AMLA
Letter of Credit (Trade Finance)
Local Cheque Purchase
Loan Collection System
Loss given default - the fraction of EAD that will not be recovered following default, and is expressed as a percentage of the exposure (specified in Basel II).
Lembaga Hasil Dalam Negeri (Inland Revenue Board)
London Metal Exchange
Letter of Offer
Labuan Offshore Financial Services Authority
Loan Origination System
Malaysian Rating Corporation Berhad
Malaysian Accounting Standards Board
Multi Currency Trade Financing
Ministry of Entrepreneur and Coorperative Development
Malaysian Electronic Payment System Sdn Bhd - A consortium set up by Malaysian banking institutions to provide shared banking services, such as shared ATM network and Interbank GIRO.
Mudharabah General Investment Account
Malaysian Government Securities
Months in Arrears
Magnetic Ink Character Recognition (character recognition technology for cheque printing)
Malaysia International Islamic Financial Centre
Ministry of Finance
Money Orders / Postal Orders
Murabahah for the Purchase Order
Mortgage Reducing Term Assurance - A form of term life insurance which reduces over the tenure of the mortgage
Medium Term Notes
Malaysian National Identity Card
Negotiable Certificate of Deposit
Negotiable Instruments of Deposit, a financial instrument issued by banks for the deposit of a specific sum of money for a fixed period of time at a prefixed interest rate. An NID can be bought or sold before the date of maturity.
Islamic Negotiable Instruments of Deposit
Negotiable Islamic Debt Certificate is the Shariah-based alternative to the Negotiable Certificate of Deposit (NCD), e.g., using the concept of Al-Mudharabah (profit-sharing) or Al-Bai Bithaman Ajil (Deferred payment sale)
Net Interest Income
Net Open Position (FX)
Off Balance Sheet
Outward Bill Collection (Trade Finance)
Outward Cheque Clearing Outsourcing
Outstation Cheque Purchase
Overnight Open Position
Overnight Policy Rate (set by BNM’s Monetary Policy Committee)
Private Commercial Enterprise
Probability of Default (credit risk)
Private Debt Securities
Performing Financing or Project Finance
Perbadanan Deposit Insuran Malaysia (Malaysia Deposit Insurance Corporation) - which currently covers up to RM60,000 per depositor per banking institution
Promise to Lease
Payment Multi-Purpose Card (chip embedded EMV-compliant smart card)
Promise to Purchase
Pre-Shipment (Trade Finance)
Profit Sharing Investment Account
Profit sharing ratio
Perbadanan Tabung Pendidikan Tinggi Nasional Malaysia (National Higher Education Fund Corporation)
Purchase With Recourse
Purchase Without Recourse
Rating Agency Malaysia Berhad
Risk Adjusted Pricing Model
Risk Adjusted Return on Capital
Risk based supervision framework (issued by BNM)
Receivable Charges, or Revolving Credit
Real Time Electronic Transfer of Funds & Securities - BNM's system for electronic funds transfer, replacing SPEEDS. Minimum amount per transmission is RM10,000 except if the remitting party is a government body.
Repurchase Agreement - the bank sells its money market instruments approved by Bank Negara Malaysia to an investor, with an understanding to buy back the said instruments at an agreed price (interest rate) on a specific future date.
Redeemable Secured Bonds
Redeemable unsecured bonds
Risk weighted Asset
Risk Weighted Capital Adequacy Framework (BNM)
Risk Weighted Capital Ratio
SWIFT Alliance Access
Sale and buy back agreements
Standby Letter of Credit
Single customer credit limit
Shipping Guarantee (Trade Finance)
Special Investment Account, or Specific Investment Accounts
Share Margin Financing
Sum of Digits
Sale and Purchase Agreement
Sistem Pemindahan Elektronik Dana dan Sekuriti (BNM) - this has been replaced by RENTAS
Skim Perbankan Islam – Islamic Banking Scheme launched by BNM in 1993 allowing conventional banking institutions in Malaysia to offer Islamic banking products and services using their existing infrastructure, including staff and branches.
Sistem Penjelasan Imej Cek Kebangsaan - national cheque clearing system
Special Purpose Vehicle
Signature Specimen Card
Self Service Terminals
Skim Simpanan Pendidikan Nasional (National Education Savings Scheme by PTPTN)
Short Term Investments
Suspicious Transaction Report (for BNM required under AMLA)
Short Term Revolving Credit, is a financial tool for short-term non trade-related activities. The tenor ranges from 1 to 12 months.
Signature Verification System
Society for Worldwide Interbank Financial Telecommunication - operates a worldwide financial messaging network allowing financial institutions to securely and reliably exchange financial transactions.
Temporary Qardhul Hasan
Trade Working Capital Financing
Uniform Customs and Practice for Documentary Credits. UCP600 is a set of trade global finance guidelines implemented in July 2007. UCP is the work of ICC, an international organisation founded in 1919.
Unclaimed Moneys Act 1965
Value at Risk - VaR is a measure of the loss in market value of a position/portfolio, which is expected over a given holding period for a given confidence interval. The underlying premise of VaR is that the historical volatility and correlation's between different types of risk factors can be used to estimate the overall variation in the value of different and numerous cashflows.
Weighted Risk Assets
Zero Balance Account