KUALA LUMPUR, March 15 — Malaysian banks have limited exposure to the problems faced in the US financial sector following the high-profile collapse of the Silicon Valley Bank (SVB), Deputy Finance Minister Steven Sim told the Dewan Rakyat today.

He said the reduced risk was based on the Malaysian authorities’ assessment.

"Actually, the problem of Silicon Valley Bank based on the Malaysian authorities' assessment, the banking institutions' exposure to the crisis in America is minimal and limited.

"The banking system remains competitive and resilient and continues to carry out its role as a financial intermediation effectively.

"In terms of guidelines, capitalisation guidelines and liquidity guidelines, we have quite strict rules,” Sim said during Question Time.

He was responding to Bachok MP Mohd Syahir Che Sulaiman who wanted to know what the Finance Ministry, Bank Negara Malaysia, and the Securities Commission will do to mitigate any possible adverse effects from SVB’s collapse.

The PAS lawmaker also asked if there were any early impact on local banking institutions such as an increase to the overnight policy rate or if Malaysia would see inflation go up or its ringgit weaken further.

Sim said the Malaysian banking system undergoes stress tests from time to time, adding that the country’s institutions are ready to face market pressures.

In a tweet today, Minister of Economy Rafizi Ramli also said no Malaysian company has deposits at SVB, adding that he does not expect local companies to face any direct impact from the US institution’s collapse.