Ladies and Gentlemen: The Islamic Financial Services Board, IFSB will serve as an association of central banks, monetary authorities and other institutions, entrusted to develop and promulgate internationally accepted prudential regulatory standards and best practices. In advancing this mission, the Board will examine the extent to which existing international best practices need to be adapted and complemented to be consistent with Shari'ah principles. The IFSB will liaise and collaborate with other international standard setting bodies to achieve the common goal of international financial stability. In addition, the Board will also focus on the development of risk management instruments, cultivation of sound risk management practices and facilitate the implementation of robust risk control mechanisms in Islamic financial institutions through research, training and technical assistance. This would encompass the adoption of international best practices on risk management standards as well as the development of new risk management techniques in conformity with Shari'ah injunctions. Ladies and Gentlemen: The forces of globalisation, financial liberalisation, technological advancements, intensified competition and financial innovation have created new risks which are more complex and which have more profound systemic implications. Accordingly, to manage these risks, prudential regulation and supervisory oversight have become more demanding and challenging. To ensure the international financial regulators and supervisors are able to respond effectively to the changing environment, the Basel Committee has revised its Capital Accord to be more risk-focused and risk-sensitive. In this respect, the IFSB can certainly draw on this framework in designing the Islamic financial supervisory regime.

Firstly, it enhances the potential for higher global growth, while also contributing towards some rebalancing of the global growth. Secondly, the strengthened international financial linkages allows for greater potential for the diversification of risks. The increase in the Islamic financial products, the growing number of assets classes being offered, the increased cross ownership of assets all have expanded the possibilities for greater diversification of risks and the potential for return. Today, Islamic finance represents a multi-billion dollar industry which has a presence in many countries and more recently, there has been widening participation by established financial centres. There are now more than 200 Islamic financial institutions, some of which are global players, offering an extensive range of Shariah compliant products and services to a broad spectrum of consumers and businesses that transcends beyond the Muslim world. This global forum has aimed to bring together the industry practitioners, issuers and investors, the regulators, scholars as well as those in related services, including the IT services, legal, accounting and auditing professionals and those in human resource development. It is our hope that the deliberations today will play a catalytic role in building greater collective efforts through multistakeholder dialogues and network-building activities whilst discovering opportunities and also improving our understanding on important areas in Islamic finance. Ladies and Gentlemen, As we know today, there are already clusters of cross-border collaborative activities taking place on several fronts that serve to contribute towards increasing the international integration process of Islamic finance.