banking sector – which is exactly what we aim to achieve with the cts which we are rolling out this evening. despite our skilled navigation, we remain exposed to the financial distress and the sovereign debt crisis of the western world. any step we can take to increase efficiency and complete financial transactions more rapidly to reduce the need for working capital, will help us to elude the general slowing of the world economy and the adverse impact of the faltering recovery elsewhere. second, we should not be surprised if some of the international bank branches and subsidiaries which are operating in our country are affected by the policies being pursued by their overseas parent. we can seek to insulate our jurisdiction a little by insisting that any future international bank, that sets up operations in mauritius, does so via a subsidiary. third, it is vital that we address issues going under the seemingly - innocuous triple acronyms of lcfi, sifi, and tbtf. telling ourselves “ it won ’ t happen here! ” won ’ t do. we must come to grips with lcfi ’ s, large complex financial institutions, especially those that are sifi ’ s, systemically important financial institutions, and may qualify as tbtf, or too big to fail. this last point is particularly troublesome for a small economy. we have a high degree of concentration in the banking sector, with the hirshman - herfindahl index standing at 2024 in june this year, which is unusually high and well above 1800, the entry point for high concentration. the top two banks, both local, have total domestic assets which exceed by more than 30 per cent the combined assets of all the other 15 banks which have domestic operations. we have associated problems arising from the concentration of asset ownership in the country − which makes it very problematic to apply such notions as “ independent directors ”, “ related party transactions ”, or to have recourse to such prudential principles as the regular rotation of auditors and so forth. these may become a source of vulnerability and undermine financial stability as contagion can spread rapidly through the domestic banking and financial system. more pointedly, some of the banking groups have just become too large and too diversified for the central bank to supervise as effectively as we would wish with the resources at our disposal. we intend to work with the banking industry, and in particular with the banks directly concerned, to ring - fence domestic banking operations which will be subject to full supervision including risk - based and macro

abdul rasheed ghaffour : islamic finance and the fiqh of crisis management keynote address by mr abdul rasheed ghaffour, deputy governor of the central bank of malaysia ( bank negara malaysia ), at the 16th international shariah scholars forum ( issf ) " islamic finance and the fiqh of crisis management ", 6 october 2021. * * * assalamualaikum w. b. t and a very good afternoon to all distinguished guests and fellow participants. it is a pleasure and honour for me, to be part of what i believe will be another stimulating and thought - provoking dialogue. i would like to record the bank ’ s appreciation to isra for hosting this annual platform, and also more broadly, for its continued dedication in advancing the frontiers of applied shariah knowledge in islamic finance towards greater heights and prominence. the chosen theme “ islamic finance and the fiqh of crisis management ” is very apt and timely. with the persisting rage of the covid - 19 pandemic, our economic and financial backdrop is gripped with unprecedented challenges that emerged within a very short period of time – priced with great health, economic and social costs. the forecasted statistics are rather staggering, sparing no countries from economic fallout and social regress. with as many as 150 million people globally estimated to be pushed into extreme poverty by 20211, exacerbated with the fact that global unemployment is expected to hit more than 200 million people by 20222, the impact from the crisis has disproportionately affected the most vulnerable. at the same time, disruptions and displacements due to the long - term threats of climate change events continue to persist. collectively, these present serious ramifications to macro and socio - economic development. implicit from this crisis is the valuable lesson which compels us to rethink on how we can and should navigate more inclusive and sustainable development, and the role of finance. this presents a prime opportunity for islamic finance to deliver greater values and impact. with principles of maqasid shariah that are universally aligned with the vision of sustainable, balanced, and inclusive economic growth, islamic finance can meaningfully contribute towards delivering maslahah ( benefits ) at large and preventing mafsadah ( intensified harm ) to the economy and livelihood of the people. indeed, islamic finance and islamic financial institutions can provide clear leadership on this front. as the global economy heads towards recovery, a