Bank Negara Malaysia today stressed the importance of preserving the central bank's integrity, following cabinet's decision to form a Royal Commission of Inquiry (RCI) into the 1980s foreign exchange scandal.

"The central bank will extend full cooperation to the commission in providing information as required by the law.

"It is important to note that in any country, the legitimacy, integrity and credibility of the central bank are paramount in preserving public confidence in maintaining a sound financial system and a stable economy," it said in a statement.

It added that the RCI, which will "put to rest the events that occurred more than 25 years ago", will not distract the bank from discharging its duties.

"We shall be steadfast in safeguarding the nation’s monetary and financial stability, as well as the smooth functioning of the payment systems," it said.

The Prime Minister's Office yesterday said the cabinet gave the nod to form the RCI after a special task force investigation found "elements of a cover-up and attempts to confuse cabinet and Parliament".

The task force also found the losses incurred by Bank Negara was larger than what was then reported to Parliament and cabinet.

The task force headed by former chief secretary Sidek Hassan probed the matter from February to May and handed over its report yesterday...