At the international level, the issuance of the first sovereign global Islamic sukuk by the Government of Malaysia in 2002 has been followed by a series of other issues. Corporations and multilateral development institutions have also embarked to issue Islamic financial instruments resulting in an increase in the range of products in the international capital market. Islamic sukuks have now breached the USD15 billion mark. The Islamic sukuks have attracted a broad range of investors. In 2004, to deepen our capital market further, Malaysia liberalized our exchange administration rules to allow multinational corporations and multilateral agencies to raise ringgit denominated papers in our domestic bond market. Multilateral financial institutions including the International Finance Corporation and the World Bank have since issued Islamic based ringgitdenominated instruments. We welcome the origination and issuance of Islamic financial instruments to be issued in Malaysia. The growth in Islamic asset and wealth management has also been phenomenal arising from the diverse and innovative structures of Islamic investment funds, including Islamic hedge funds. It is  BIS Review 4/2006  1  estimated that more than 250 Shariah-compliant mutual funds are currently managing approximately USD300 billion in assets. Shariah-compliant screening techniques have been able to improve riskadjusted returns on Islamic investment funds which in turn have led to its adoption in improving the risk-adjusted returns of conventional equity funds.

12  The Bank of England is now working with the FCA and HMT to make  this a reality, and we will issue our new blueprint for RTGS in early May. Coordinated Developments in Hard and Soft Infrastructure My third example of the Bank’s efforts to realise FinTech’s promise is our work with industry to help coordinate advances in hard and soft infrastructure. New technologies could transform wholesale payments, clearing and settlement. In particular, distributed ledger technology could yield significant gains in the accuracy, efficiency and security of such processes, saving tens of billions of pounds of bank capital and significantly improving the resilience of the system. 13  12  See “Enabling the FinTech Transformation”, the speech Mark Carney intended to deliver at Mansion House on 16 June 2016. Available at: http://www.bankofengland.co.uk/publications/Pages/speeches/2016/914.aspx. 13 Oliver Wyman and Santander estimated that distributed ledger technology could reduce banks’ infrastructure costs attributable to cross-border payments, securities trading and regulatory compliance by $ per annum by 2022. See: https://santanderinnoventures.com/fintech2/ 7  All speeches are available online at www.bankofengland.co.uk/speeches  7  Securities settlement seems particularly ripe for innovation. A typical settlement chain involves many intermediaries, making it comparatively slow and keeping operational risks high. Industry has begun to work together to determine how distributed ledger technologies could be used to solve these issues at scale. The Bank is participating in several related initiatives. To help distinguish distributed ledger’s potential from its hype, we have completed our own Proof of Concept.