Expectations and directions for Malaysian Development Financial Institutions I would also like to share some reflections on expectations and directions for development financial institutions in Malaysia I am well aware that development financial institutions around the world, including in Malaysia, face unique challenges. In many ways, they have to manage and balance responsibilities that are substantially more complex than institutions with narrower profit-making mandates. In Malaysia, these institutions have embarked on initiatives over the last decade and a half to build greater financial resilience and stronger foundations for sound management. This has enabled them to pay an important counter-cyclical role during downturns, and to support economic activity in targeted segments. However, more effort is required on critical appraisal of their development impact. It is much needed to sharpen the development focus, redirect and amplify the impact of financing activities. It will also provide the impetus for them to focus on other interventions that can increase their impact. We intend to work with their leadership and other stakeholders in Government in the coming months to address a more focused delivery of mandates. In this respect, improving performance measurement frameworks and increasing transparency in the operations will be important areas of focus. We need to measure the right things, measure outcomes that matter and measure mandates that are relevant. This needs to be driven by a clear vision and strong leadership, and uncompromising governance. We expect our development financial institutions to operate with the highest level of professionalism and integrity at all levels of the organisation.

Another way to promote creativity is to create a facilitative environment for public private partnerships provides the best prospects to drive innovative strategies. With advances in technology, the scope and potential for such partnerships have increased exponentially. We see this in partnerships between mobile network providers and financial institutions in sharing data which can increase financial inclusion among borrowers that do not have a prior credit history. Partnerships that leverage on e-marketplaces and social media platforms also have enormous potential to increase the reach and development impact through the deployment of innovative strategies. Enhance corporate governance For many institutions, the ability to significantly increase their impact is closely tied to issues of corporate governance. Narrowly defined financing targets and links between business and Government have led to suboptimal resource allocations, increased moral hazard, and market 3/4  BIS central bankers' speeches  distortions. These can pose a drag on the economy and the overall development agenda. Broader confidence can also take a hit on suspicion of undue preference in extending financing, making it more difficult to mobilise resources for development. The critical appraisal and monitoring functions are largely shaped by the strength of its corporate governance. These require competent and professional boards to be installed, clear rules of engagement with their stakeholders, and stronger performance management standards that are aligned with development outcomes.