AMBD is a corporate body, acting as the central bank of Brunei and undertakes core functions, including the formulation and implementation of monetary policies, regulation and supervision of financial institutions and currency management. AMBD was established on January 1, 2011 with the introduction of the AMBD Order, 2010.
The Order, among other things, provides for its board and matters connected to the objects, operation, administration, functions, powers and duties of AMBD that include relations between it and the Government, the banks and other financial institutions and consequential and related amendments to other written laws that govern the activities supervised by AMBD.
The main objectives of AMBD are to achieve and maintain domestic price stability, to ensure the stability of the financial system, particularly by formulating financial regulation and prudential standards to assist in the establishment and functioning of an efficient payment and settlement systems and to oversee them and to foster and develop a sound and progressive financial services sector.
In line with the AMBD Order, 2010, His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah ibni Al-Marhum Sultan Haji Omar ‘Ali Saifuddien Sa’adul Khairi Waddien, Sultan and Yang Di-Pertuan of Brunei Darussalam has also consented to the Currency and Monetary (Amendment) Order, 2010, which also commenced on January, 1, 2011.
This Order provides for the transfer of Brunei Currency and Monetary Board’s (BCMB) powers to AMBD, including its assets and liabilities. It also provides for the establishment of the Currency Fund for the purpose of currency management.
In its bid to reduce household debt, AMBD had directed banks, finance companies and Perbadanan Tabung Amanah Islam Brunei (TAIB) to introduce the Total Debt Service Ratio (TDSR) system for all customers applying for a financing facility. The regulations were aimed at developing responsible and ethical lending practices by banks, promoting responsible borrowing behaviours to foster a healthy and sustainable credit market which in turn can contribute to economic and financial stability and further strengthening the protection of consumer’s interests.
The TDSR set by AMBD is 60 per cent for customers with a minimum net salary of B$1,750. Below this limit, customers will be subjected to the individual financial institutions internal policy on TDSR. Financial institutions are required to ensure that customerswillnotbeoverburdenedwiththecredit/ financing facilities, according to the AMBD.
The financial regulator has also directed the creation of a Consolidation Loan/Financing Scheme. Subject to meeting the required set of criteria, this scheme will help the heavily-indebted borrowers with significant monthly debt obligations to consolidate and lower their overall monthly repayment obligation.
AMBD has been constantly updating and reviewing the legal and regulatory framework so as to promote an efficient, fair, and orderly market and to prevent market misconduct.
AMBD recently has found that there have been fraudulent incidents involving the sale of insurance/ Takaful policies by unlicensed insurance/Takaful agents or other persons to the public. It has advised the public to deal only with Takaful operators, insurance companies and general insurance/ Takaful agents that are licensed by AMBD. Members of the public who choose to deal with unlicensed and unregulated persons offering financial services or products will not have enforceable contracts nor the protection afforded under the regulatory framework administered by AMBD.
AMBD’s regulatory framework aims to safeguard the interests of the public and consumers by ensuring that only competent and qualified persons are authorised to provide financial services in Brunei.
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