Bank of Maldives (BML) has clarified the distinction between its Net Open Position (NOP) in US dollars and its liquidity position, stating that while its foreign exchange exposure had previously deteriorated, its ability to meet customer obligations remains stable.

In a statement, the bank said the Net Open Position reflects the difference between foreign currency assets and liabilities and measures exposure to exchange rate movements, rather than available cash. Liquidity, by contrast, relates to the bank’s capacity to meet short-term obligations, including withdrawals and payments, noting that the two indicators serve different purposes in assessing financial health.

BML revealed that its US dollar NOP had declined since December 2020, reaching a short position of 20 per cent in September 2024, equivalent to approximately USD 200 million. The bank noted that the exposure carried potential foreign exchange risk in the event of a currency devaluation, but stressed that this did not affect its liquidity or its ability to meet customer transactions.

According to the bank, the short position was addressed through coordinated measures with support from the Ministry of Finance and Planning, allowing the NOP to return to positive levels during the past year and again more recently, in line with regulatory requirements. During this period, the bank said it continued operations without disruption, recording over USD 600 million in dollar sales to individuals, businesses and corporates for transactions including telegraphic transfers and card payments.

BML stated that US dollar liquidity continues to be managed through diversified funding sources, treasury operations and coordination with stakeholders, ensuring continued service delivery. The bank added that it extended USD 365 million in loans to the tourism sector from 2024 to the present, with the sector’s loan portfolio reaching USD 585 million by the end of the first quarter of 2026.

Chief Executive Officer and Managing Director Mohamed Shareef said the bank’s financial performance remains strong, with record results achieved in its 43-year history, supported by capital and liquidity ratios within regulatory and international standards. The bank reiterated its commitment to transparency, prudent financial management and maintaining stakeholder confidence.