In the international regulatory front, we recently assumed the chair of the Asia Pacific Regional Committee (APRC) of the International Organisation of Securities Commissions (IOSCO), and sit on the IOSCO Executive Committee. We have also assumed the chair of the EMEAP Working Group on Banking Supervision, which will facilitate the region’s discussion on implementation of Basle II. We are committed to regional and international co-operative efforts that help to foster a stable global financial system. In that regard, we contributed actively to initiatives of other forums such as BIS, FSF, IAIS and FATF, in the areas of financial stability, regulation and supervision, corporate governance and antimoney laundering. VI  Ensuring business continuity  In the area of Business Continuity Management (BCM), MAS conducted several exercises last year to ensure the effectiveness of our BCM plans. We also inspected BCM plans of major financial institutions (FIs) and found that FIs are generally prepared. For example, during the recent blackout, affected FIs continued operations smoothly on back-up power and activated their incident management process to verify that their buildings and operations were functioning normally. The blackout had minimal impact on the financial sector. VII  Accounts  Let me now move on to the MAS’ financial statements. MAS’ total assets grew 16.8% during the year ended 31 March 2004 to $ 179.7 billion. The Currency Fund’s assets, at the financial year-end, exceeded the $ 14.6b currency in circulation, providing 110% asset backing.

During the year, apart from enhancing the regulatory environment, MAS worked with other government agencies to improve the tax and legal environment for financial institutions involved in the wealth management business. The new Trustees Act is expected to come into force later this year. MAS will also be introducing a framework to regulate trust companies. The proposed framework will ensure high standards of business conduct, professionalism and competence in the trust services industry in Singapore. The Singapore dollar bond market has developed beyond serving the needs of just local borrowers and has attracted a diversified base of foreign issuers as an alternative venue for cost-effective funding. Large issuers, including Freddie Mac, Fannie Mae and Asian Development Bank have found cost-effective opportunities to tap our bond market. In five years, the market has grown significantly in breadth and depth. Product range has also increased significantly. Structured products now account for more than half of the Singapore dollar bond market. The asset securitisation market has also gained traction, recording a fivefold increase since 1999. To further enhance the attractiveness of Asian capital markets, MAS has, over the past year, worked with various governments in the region to encourage investor demand, and to address market access and market infrastructure issues. The Asian Bond Fund or ABF is one such initiative. After the successful launch of ABF 1, the Executives’ Meeting of East Asia-Pacific Central Bankers or EMEAP is making good progress on ABF2 to invest in local currency-denominated Asian bonds.