Banking business as defined by the Banking and Financial Institutions Act 1989 (Bafia) includes the business of receiving deposits, paying and collecting cheques drawn or paid in by customers, lending of money, leasing business, factoring business as well as the purchase of bills of exchange and other trade documents.
Bafia does not differentiate between core and non-core functions. Section 4 of the Bafia states that any person or institution to commence banking business must have a valid licence granted under the Act.
However, Bank Negara has defined core business as any activity which requires decision making by the bank and this includes deposit taking, loan approval and administration, trading, investment and provision of fee-based service, says the National Union of Bank Employees (NUBE), referring to the central bank's letter dated March 7 last year.