2  All speeches are available online at www.bankofengland.co.uk/speeches  2  Part of the case for an international capital standard is that insurance markets have become more global over the past few decades, even if that trend appears to have steadied after the financial crisis (Chart 1). This is most obvious in wholesale general insurance and reinsurance, where the underlying rationale for insurance provision arises from the law of large numbers and the benefits from pooling and diversifying across risks. Recent cross border mergers and acquisitions, and with talk of more to come, suggests the increase in the amount of business written by overseas companies might resume. Chart 1: business written by overseas insurers  Source: OECD and Bank calculations  Mergers and acquisitions are in part a response to the prolonged period of soft conditions in wholesale general insurance and reinsurance markets. For many insurers underwriting returns are now below the levels required to achieve sustained profitability, even in years of ‘normal’ natural catastrophe activity. Our sense is that until this year, many had thought that market conditions would improve cyclically: for example, following a large loss event. They had therefore sought to maintain their market position and wait for better times. The limited increase in market prices following the losses from the 2017 hurricanes in the US and Caribbean has, however, caused a number of boards to look more fundamentally at the sustainability of their current businesses.

With a diverse population and a growing middle class, Malaysia is an ideal test bed for developing and commercialising fintech solutions. The emergence of fintech has opened up new opportunities which can greatly benefit the financial industry. At its core, fintech has led to the creation of various business models that help improve and simplify financial transactions, which 10 or 20 years ago seemed impossible. Here, I would like to highlight three key areas that Islamic finance stand to gain from fintech. Entrepreneurs too stand to gain from fintech. First, fintech provides the technological underpinnings to realise the goal of Islamic finance in creating a risk sharing economy. This will in turn benefit entrepreneurs who will gain wider access to bank-intermediated credit. An example is the Investment Account Platform (IAP). IAP is Malaysia’s first multi-bank online 1/3  BIS central bankers' speeches  platform that combines the credit evaluation expertise of Islamic banks and the power of technology to channel funds from investors to economic ventures. This virtual “multisided” platform facilitates a collection of interesting investment ventures and projects, with transparent risk-return rewards for investors. Second, fintech has opened up new sources of funding to entrepreneurs, in what is increasingly being referred to as the alternative financing space. Crowdfunding and peer-to-peer (P2P) funding platforms have emerged as highly efficient “matchmakers” between entrepreneurs and investors. From the USD10 million raised globally in 2009 through nine major platforms, crowdfunding platforms mobilised over USD767 million in 2016 with backers from over 200 countries.