KUALA LUMPUR (Jan 27): The Penang state government is engaging in high-level consultations with key federal regulators as it explores the development of a proposed international financial centre in the state.
Chief Minister Chow Kon Yeow said discussions are ongoing with Bank Negara Malaysia, the Securities Commission Malaysia and the Labuan Financial Services Authority to ensure that any proposal complies with national regulations and policy frameworks.
According to Chow, the objective is to ensure that the initiative is both innovative and fully aligned with Malaysia’s Financial Sector Masterplan, while maintaining strong governance standards and avoiding duplication within the country’s existing financial ecosystem.
“At this stage, there is no final decision on the location or structure of the proposed financial centre. It remains a long-term strategic aspiration aimed at strengthening Penang’s economic resilience and positioning the state as a competitive regional hub for technology and financial services,” he said.
The proposal comes as Penang seeks to accelerate economic growth and build a stronger financial services sector to support its role as a major manufacturing and high-technology base for multinational companies.
If implemented, the financial centre is expected to focus on specialised segments such as digital assets, fintech solutions and manufacturing-related financial services. These may include supply chain financing, trade facilitation and financial platforms supporting industrial innovation.
To assess market demand and build investor confidence, the state government is conducting phased stakeholder engagements through Penang Institute, its policy think tank. While a comprehensive federal framework has yet to be finalised, the state remains committed to establishing a solid foundation for the initiative.
In November 2025, the Penang government requested further details from IJM Corp Bhd, Gamuda Bhd and Eastern & Oriental Bhd on their proposed development partners and the types of financial services they intend to anchor within the hub. The project is estimated to involve investments of up to RM10 billion.
The proposed financial centre is expected to cover close to 100 acres, with potential locations reportedly including Gurney Bay, Jelutong, Pulau Jerejak, Penang South Island, North Butterworth and Batu Kawan.
Chow reiterated that Penang will continue advocating for the initiative, even after the Ministry of Finance previously indicated that the timing was not ideal to move forward with the plan.
From a broader market perspective, the development of a regional financial hub would complement Malaysia’s established business centres, reinforcing long-term demand for commercial property in KL and high-quality office space in Bukit Jalil. At the same time, expanding financial and industrial ecosystems continue to support activity across the Klang Valley, including sustained interest in industrial land in Selangor, factory developments in Puchong, and mature industrial property in the Subang area serving manufacturing and logistics needs.
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