Source from (Bernama): http://www.bernama.com/bernama/v7/bu/newsbusiness.php?id=950159
Published: May 17, 2013
Source from (The Star Online): http://biz.thestar.com.my/news/story.asp?file=/2013/5/17/business/13123049&sec=business
Published: May 17, 2013
Exchanging views: Zeti talking to Islamic Development Bank Group president
Tan Sri Dr Ahmed Mohamed Ali Al Madani. With them is Sheikh Abdulla
Bank Negara Malaysia Governor Tan Sri Dr Zeti Akhtar Aziz said this involved strengthening the resilience of the Islamic financial system in alignment with the evolving international regulatory developments, thus raising the bar of industry performance.
"The Islamic Financial Services Board (IFSB) has made significant advancements in leading the efforts to review specific measures put forward by the Basel Committee for possible adoption in Islamic finance.
"Further to this is the imperative to cultivate a strong risk culture within institutions, she said in her opening address at the 10th IFSB Summit here today.
"Reinforced by a robust Shariah governance framework, it will ensure that innovation for furthering the development of Islamic finance is harnessed within the boundaries of the Shariah, which would avert overzealous innovative activities that could undermine financial stability," she said.
As the industry transitions into a new era of growth and development in this post-crisis world, Zeti said the competitive financial landscape was being redrawn by the evolving international regulatory reforms, changing operating models, rising consumer expectations and increased competition.
"In this more challenging environment, the success of sustaining the momentum of Islamic finance as a transformative agent for the economy, will hinge on the ability to keep raising the bar in the pursuit of an effective functioning and sound Islamic financial system," she said.
She said post-crisis the increased emphasis for inclusive and sustainable products as well as responsible corporate behaviour provided clear potential for Islamic financial players to demonstrate leadership by capitalising on core value propositions of Islamic financial intermediation.
"There is also scope for greater leverage on the advances of technology and new institutional arrangements that can enhance operational excellence, particularly distribution channels for extending outreach to the range of users from households to micro-enterprises and small and medium scale enterprises," she said.
According to her, in the wake of the global financial crisis, there was a consensus on the need for a return to financial systems that serve the real economy, and the demands for more responsible financial practices from the financial sector, that also included the commitment to achieve socio-economic goals.
"In response, the international community is prioritising financial stability by strengthening financial regulation.
This includes financial reforms aimed at protecting depositors from excessive risk-taking, over-leveraging and unfettered innovation," she said.
The reform initiatives, Zeti said, had also focused on enhancing capital and liquidity standards, reinforced by moves to strengthen the macro-prudential orientation of regulation to complement micro-prudential supervision to manage the risks arising from the interdependencies within the financial system.
"Whilst the breadth of regulatory changes being considered collectively endeavour to strengthen the financial system's resilience, the key challenge for policymakers and regulators going forward is also to achieve inclusive and more sustainable growth, whilst ensuring financial stability," she added.
-- BERNAMA
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