A rate that banks have used to help set the cost of borrowing since 1987 is being replaced. Maybank has told customers that the Kuala Lumpur Interbank Offered Rate, known as KLIBOR, will stop being used for new loans and financing from 1 July 2027 and will be discontinued from 1 January 2029, replaced by two newer rates called MYOR and MYOR-i.

The change applies across the banking industry, not only at Maybank, and follows an announcement by Bank Negara Malaysia in October 2025. You’ll probably never see KLIBOR on a statement, but it helps set the price of certain loans, financing, and other banking products. If you hold one of those, your terms will eventually move to a different rate.

From Estimates To Real Trades

KLIBOR has been around since June 1987. It’s meant to show how much it costs banks to borrow ringgit from one another, and that figure then feeds into the price of some loans and financing.

It’s based partly on rates banks report themselves rather than only on real deals. The UK used a similar rate, the London Interbank Offered Rate (LIBOR), and dropped it in 2023. Other countries have since moved to rates based on real transactions, and Malaysia is now doing the same. 

MYOR and MYOR-i Replace KLIBOR

In its place, banks will use the Malaysia Overnight Rate (MYOR) and its Islamic equivalent, the Malaysia Islamic Overnight Rate (MYOR-i). Bank Negara introduced MYOR in 2021 and MYOR-i in 2022, so both have been running for several years.

These two are based on the rates banks charge each other for short-term ringgit loans, so they track real market conditions more closely. 

The Timeline From 2027 To 2029

Maybank has set out three key dates for customers. 

The plan grew out of a discussion paper Bank Negara published in September 2024, which drew broad support from banks before the timeline was confirmed.

Check If Your Products Use KLIBOR

If you’ve got a typical home loan, the day-to-day effect is small. Most home loans follow your bank’s base rate, which moves with the Overnight Policy Rate (OPR) that Bank Negara sets, not with KLIBOR. So this change doesn’t affect how your repayments are worked out.

If you hold a product that uses KLIBOR, it’ll move to MYOR or MYOR-i. Maybank says this can include certain loans, financing, deposits, and investment accounts. The switch on its own doesn’t change what you owe, since Bank Negara has asked banks to either move existing agreements across or add wording that sets out which rate takes over and any adjustment that comes with it. 

Maybank has said it’ll contact you directly if your products are affected. In the meantime, if you’re not sure where you stand, check your loan or financing agreement for the rate it’s based on, and keep an eye out for letters from your bank as the 2027 and 2028 dates approach. For most people, a new product over the next few years may simply show a different rate name, even if it behaves much the same when interest rates move.

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Christina Chandra

Christina writes about personal finance with an eye for making the complicated feel straightforward. She is drawn to the everyday money decisions people face and genuinely enjoys finding the clearest way to explain them. Between articles, she is probably napping, on a hiking trail, or terrorising her sister’s cats.

About THE AUTHOR

Christina Chandra

Christina Chandra

Christina writes about personal finance with an eye for making the complicated feel straightforward. She is drawn to the everyday money decisions people face and genuinely enjoys finding the clearest way to explain them. Between articles, she is probably napping, on a hiking trail, or terrorising her sister's cats.

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