the bank published a comprehensive framework to'green'our corporate bond portfolio to support the transition to net zero, while at the same time not undermining the scheme's primary monetary policy purpose. whilst the portfolio is currently unwinding in - line with monetary policy objectives, we have created a greening framework for other investors on how to green a corporate bond portfolio. and our convening role as the uk's central bank should ensure they take note. this ties in well with the third area, our prudential work. as the uk's central bank and prudential regulator, it is the bank's role to ensure the resilience of the financial system to the impacts of climate change, including the transition to net - zero. collaborating with many others through the network for greening the financial system we are seeking to understand how different transition pathways could affect the economy and the stability of the financial system, as well as the safety and soundness of the firms we regulate. back to liquidity given the unprecedented shocks facing the global economy it is more important than ever that there is a focus on ensuring the right frameworks and approaches are in place to bring about appropriate levels of risk management and resilience to safeguard financial stability. this is particularly true in terms of liquidity, where the experience of recent weeks reminds us of the range of vulnerabilities which exist, particularly in the nbfi sector, which is why it is an ongoing focus for the g20. liquidity is an important and topical subject. but given our focus for today let me return to the bank's alternative liquidity facility ( alf ) to illustrate my favoured approach of using the 4cs. for many years islamic banks have faced challenges in efficient liquidity management, unable to hold the same high - quality liquid assets as conventional banks, such as central bank reserves, sovereign debt and asset - backed securities. further, while basel liquidity rules gave national supervisors discretion to treat sukuk as high quality liquid assets, the amount of sukuk in issuance eligible for this treatment is modest relative to demand for it. to avoid being caught short, islamic banks have historically needed to structure themselves in inefficient ways by, for example, holding large stocks of non - interest bearing cash, or having limited offerings of short - term deposits. the alf – structured as a wakalah, or fund - based facility – provides a creative solution. participant deposits in the

to buy shares. these are all signs of rising affluence, driven by a very prolonged economic expansion. over 80 per cent of households in the top half of the income distribution have some type of debt, compared with only 30 per cent of those in the lowest decile ( graph 7 ). essentially, higher - income households are the ones that have the capacity and the financial security to take on debt. it seems that debt is one of those products, like education and health, which has a high income elasticity of demand – i. e. as income rises, demand for it rises more than proportionately. it would be a mistake, therefore, to conclude that a rising ratio of debt to income is necessarily a sign of financial stress among households. graph 7 it is the high - income groups that have had the biggest increase in debt over recent years ( graph 8 ). about three quarters of the increase in owner - occupier debt over the decade to 2005 / 06, for example, was attributable to households in the top half of the income distribution. if comparable figures on debt associated with investment properties and margin loans were available, they would almost certainly further skew this distribution of debt. graph 8 despite the rise in the debt of this group of households, their debt servicing burdens remain relatively low. for those households who are in the top half of the income distribution and who have an owner - occupied housing loan, housing loan repayments currently average a little less than 20 per cent of gross income. this has risen only marginally over the past decade, and it remains significantly lower than the figure of around 30 per cent for households in the bottom half of the income distribution. this suggests that the former group still has substantial capacity to service debt. at the aggregate level across all households with owner - occupier housing debt, the median ratio of housing loan repayments to gross income, at about 21 per cent, is only marginally higher than a decade ago ( graph 9 ). graph 9 another interesting feature emerges when the composition of debt is broken down by age group. this shows that a large contribution to the increase in household indebtedness has come from households aged 45 - 65. this group no doubt overlaps considerably with the high - income household group. over the 10 years to 2006, the proportion of households aged 45 - 64 that are carrying owner - occupier debt increased very noticeably, from 25 per cent to 38 per