To a greater extent than with SPE, a MPE resolution can be impeded by financial connections between different parts of the group, whether arising from intergroup loans or from business lines, such as global payment services, that are integrated but spread across different legal entities. In supporting MPE as a preferred strategy, the home and key host resolution authorities will have to satisfy themselves robustly that such interlinkages would not impede resolution via splitting up the group. In practice, that will mean reducing intragroup exposures. Operational dependencies between different parts of the group are another priority where MPE is the preferred strategy. For example, some global commercial banking groups seek to exploit economies of scale and scope by drawing on centralised operational services (in particular related to IT and processing). MPE does not work unless those arrangements can survive the breakup of the group. At the very least, that entails service-level agreements and  12  FSB Key Attributes paragraph 7.4: “National laws and regulations should not discriminate against creditors on the basis of their nationality, the location of their claim or the jurisdiction where it is payable. The treatment of creditors and ranking in insolvency should be transparent and properly disclosed to depositors, insurance policy holders and other creditors.”  13  See FDIC and Bank of England (2012), Resolving Globally Active, Systemically Important, Financial Institutions. 8  BIS central bankers’ speeches  transitional support arrangements being effected via enforceable contracts.

Today, in conjunction with the opening of the Beijing office, Bank Negara Malaysia wishes to announce further measures to reinforce the progress that has been made, and as part of the efforts to promote bilateral trade and investment. i. To facilitate more effective renminbi liquidity management by our financial institutions in Malaysia, Bank Negara Malaysia is introducing of a Renminbi Liquidity Facility (RLF) to licensed onshore banks. This facility aims to enhance renminbi liquidity in the domestic market by providing an additional avenue for the licensed onshore banks to obtain or invest RMB with the Bank. The Bank, through its own access to the interbank market in China, will offer these liquidity facilities via the renminbi/ringgit foreign exchange market, and the renminbi money and repurchase markets in the Malaysian interbank market;  ii. Second, non-resident financial institutions that meet the prudential requirements will be permitted to offer ringgit trade financing, in collaboration with resident financial institutions. In this regard banks in China will also be allowed to provide ringgit trade financing in China; and  iii. Finally, in recognition of the growing significance of regionally active financial institutions and the increased financial inter-linkages between our two economies as well as in mutual recognition and acceptance of each others’ securities, Bank Negara Malaysia and the People’s Bank of China has today signed a Memorandum of Understanding to establish a cross-border collateral arrangement that will enable financial institutions access to the central bank’s liquidity facilities. Let me now conclude my remarks.