This is an essential 2nd task not only for the development of Islamic Financial services but also for their integration. Each country will have to look at the legal and supervisory structures for Islamic Finance. However, inconsistent standards, in areas such as legal documentation and settlement of unresolved issues, can inhibit the growth of the Islamic financial services sector across borders. Conversely, when consistent standards are applied across jurisdictions, the costeffectiveness of Islamic financial service operating across borders improve. It also improves the attractiveness of the institution’s products to international investors, regardless of the  1  Islamic Financial Services Industry Development Ten Year Framework and Strategies. This was a joint initiative between Islamic Financial Services Board, Islamic Research & Training Institute, Islamic Development Bank and Islamic Research and Training Institute. 2  BIS Review 63/2008  country of origin. A significant challenge today is the need for greater convergence of rules and practices in Islamic Finance. In this regard, I commend the work of international standard setting bodies for Islamic Finance – AAOIFI, IIFM, IDB and IFSB. For example, IFSB’s recent publications on corporate governance, disclosure and capital adequacy standards are very useful. It is important that as regulators, we participate in appropriate standard-setting international organisations, and work towards the convergence of rules and practices across jurisdictions. Where convergence is not possible, we can work towards mutual recognition of those rules. The Ten Year Framework and Strategies also highlights the need to ensure tax neutrality between the Islamic services providers and their conventional counterparts.

This time, banks have shifted from being part of the problem to part of the solution: they provided the vital liquidity shield needed by businesses during the acute phase of the crisis. Page 4 sur 11  Unfortunately, financial stability is not a steady-state that can be reached once and for all. It is a permanent task that requires constant awareness. And today, we are indeed facing growing concerns. We have entered a new phase of extremely rapid asset repricing and high volatility on financial markets, reflecting the uncertainty surrounding the macroeconomic and geopolitical environment. The Russian war in Ukraine casts a shadow over the economic outlook, while aggravating tensions on energy and commodity markets. Page 5 sur 11 The resurgence of inflation and the rising fears that it will become more entrenched, is motivating central banks around the world to normalise and possibly tighten monetary policy. As a result, financial conditions have tightened, and could tighten further. Against this background, the bottom line is: yes, we are facing rising threats to financial stability. But being gloomy and excessively alarmist across the boardi may prove to be inaccurate and even counterproductive, and result in selffulfilling financial distress. Our prime role as guardian of financial stability is to remain objective, vigilant, and to differentiate the various situations. These short-term developments exacerbate more structural and long-standing sources of financial vulnerabilities. First differentiation: although we “did the job” for banks and insurers, we didn’t do it for other non-bank financial intermediaries.