On this issue, I would like first of all to pay tribute to EIOPA which has done remarkable work to promote sound and consistent European regulation and harmonised supervisory practices within the European Union, since it was established in January 2011. The creation of EIOPA, following the Larosière report, reflected the need to move towards more integrated European supervision following the 2007–08 financial crisis, and I believe that it has been a success. In a context of increasing financial market integration, EIOPA has contributed to ensuring a true level playing field for all actors in the insurance and occupational pensions sector at the EU level, in coordination with national authorities and the other European Supervisory Authorities (ESAs). This well-balanced supervisory framework helps us deal with the “institutional” innovation – this is my first point – that we are starting to see as a consequence of the Brexit vote. Some British entities are indeed considering the possibility of simply setting up empty shell corporations in the European Union, mere company nameplates, while keeping their resources in the United Kingdom. I fully agree with EIOPA that vigilance is called for in this respect. Moreover, Brexit brings with it certain risks, and consequently the need for contingency plans. I am thinking in particular of the European policyholders who took out insurance directly with British undertakings and who should continue to benefit from the same protection.

Issuance of sukuk with longer tenure will match investment and risk management needs of takaful industry with largely long term liability. This, in particular, will greatly spur the growth potential of investment-linked products. I am sure you will also be briefed on the development of the sukuk market in Malaysia later on. Fourth, the increase in outsourcing and white labelling activities. Competitive elements and strong demand for takaful require takaful players to constantly search for solution towards greater efficiency and shorter time to market. There is strong potential for strong and experienced takaful players to leverage on their competitive strengths to be an ally of other players, especially from a new market, by becoming either outsourcing partner or white labelling provider. Fifth, as seen in international Islamic banking scene, there was growing participation of major conventional global players in the takaful and retakaful industry. In Malaysia , the strategy to encourage alliances and collaborative efforts between local and foreign players has resulted in a positive outcome with the licensing of new takaful operators consisting of joint ventures and consortia of local and foreign players which have registered early strong performance. In addition, the other 100%-owned Malaysian takaful operators are now actively looking for strategic partnership with foreign financial institutions so as to facilitate their expansion abroad and exploit opportunities in untapped markets. These five trends point to one direction – that the industry will continue to present high growth potential with growing demand, increasing competition, supported by greater sophistication and innovation of products and services.