This annual summit, organised by ASLI, has become an important forum for the industry to share and discuss issues that are of importance to the financial sector. To ensure that the financial system is best placed to serve the economy, important attention has been directed to enhance the financial infrastructure to increase access to financing to meet the new, more complex and differentiated demands of the various sectors of the economy, to enhance efficiency in the banking institutions and the functioning of the financial markets, and to put in place other supporting infrastructure that reinforce the achievement of these objectives. These efforts have been complemented by measures to ensure the soundness and stability of the system. High performance of the industry would require the banking institutions to increasingly offer greater product differentiation and value added services. This requires resources to be directed to research and development to introduce a wider range of structured and customised products and to become a one-stop financial services solution provider. The ability of the banking institutions to address the needs and preferences of specific segments and focus on customer relationships in a timely and cost effective manner is key to achieving competitive advantage and long-term sustainability. The journey towards realising the vision Ladies and Gentlemen, The banking system policy has evolved from financial sector restructuring during the late 1990s to institutional development and capacity building, and the development of supporting infrastructure to enhance efficiency and the strengthening of prudential regulation to enhance resilience and preserve stability.

-  •  These new areas will allow Islamic banks to reduce their exposure to the real estate sector, and to take advantage of the stronger growth potential of the emerging market economies. There are gaps to be filled in structured trade finance and in funding for infrastructural projects as the emerging markets grow, and as global finance consolidates. Third, Islamic finance can also seek to meet the increased demand for simpler and more transparent products and ‘back-to-basics’ finance. Investors are now much more circumspect about complex products and their risks. The crisis taught investors worldwide not only about the damage they can face from the risks that are known and unsurprising, but of the risks of ‘what we do not know’. Islamic finance, with its focus on transparency, price certainty and risk-sharing, can ride this wave of demand for simpler and more basic investments. However, Islamic finance will have to overcome a few important challenges in order to grow its share in global finance and contribute to cross-border finance. These include the need to reduce fragmentation in Islamic finance markets due to differences in accepted standards of Shariah compliance between regions, jurisdictions, and in some cases even domestically within jurisdictions. This has hampered the flow of liquidity between jurisdictions, and is in part why there is yet no Islamic equivalents to the international money and bond markets. There is considerable progress being made to address these challenges.