Malaysia's central bank eyes looser rules to boost green energy financing
Bank Negara Malaysia is reviewing regulations to allow banks to assume higher, but managed, risks in order to fund the country's energy transition.
At the JC3 Journey to Zero Conference, Bank Negara Malaysia announced a review of its regulatory approach to give banks more flexibility in handling higher-risk green investments, provided the risk is properly priced and managed. Governor Abdul Rasheed Ghaffour highlighted that while capital is available, the main obstacle is channeling funds to scalable renewable projects, many of which struggle to attract financing at an early stage.
He cited small-scale initiatives that could become viable when replicated, emphasizing the need for better structuring and risk-sharing. The central bank aims to support a pipeline of green projects as renewable energy reached 31% of installed capacity in 2025, up from 25% in 2023. However, surging electricity demand from artificial intelligence and data centre expansion could see data centres consume nearly one-third of power by 2035. Ghaffour called for a shift from reactive disaster financing toward proactive climate-resilience investment.
Why it matters
Adjusting banking rules could unlock financing for Malaysia's renewable projects and help meet growing energy demand sustainably.
How the sides frame it
HIGH AGREEMENTBoth camps report that Malaysia's central bank is reviewing regulations to give banks more flexibility for green-energy financing, but right-leaning coverage adds emphasis on large-scale projects and a specific RM5 billion financing pipeline.
CENTER
Centrist coverage frames the story as a regulatory review aimed at giving banks flexibility while stressing proper risk pricing and the need to channel capital to scalable renewable projects.
RIGHT
Right-leaning coverage frames the story as a move to let banks assume more risk to fund clean energy, highlighting large-scale ventures and a concrete portfolio of 45 proposals requiring over RM5 billion.
The right emphasises
- banks can assume more risk to finance clean energy
- focus on large-scale clean-energy ventures
- 45 proposals demanding more than RM5 billion in financing
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