Malaysian and United Arab Emirates securities regulators have signed a pact to strengthen legal cooperation and curb money laundering and financial crimes in capital markets, officials said today.

The memorandum of understanding, inked on Friday in Kuala Lumpur, between the Securities Commission (SC) and the Emirates Securities and Commodities Authority (ESCA) will also provide for developmental and training initiatives, the SC said in a statement.

The SC has signed 23 such pacts with foreign counterparts.

SC chairman Mohamad Nor Yusof said the pact was a significant step to prevent the use of international capital markets for money laundering, terrorist financing and other forms of international financial crime.

"It is vital for regulators to cooperate to ensure effective cross-border regulation and exchange of information in order to maintain smooth and well-supervised markets that remain attractive to investors," he said.

He added that Islamic capital markets will be a key area of collaboration with the pact promoting the transfer of knowledge between the two regulators when developing Islamic products and services.