asia has not only provided the impetus for the development of the domestic economies, but also enabled the region to emerge as an important economic bloc. a more recent phenomenon is the effort to promote greater regional financial integration through increased cross - border banking and financial activities within the region. financial institutions in asia are increasingly turning their focus to strengthening their regional presence taking advantage of asia ’ s enormous growth prospects. malaysian banks, for example, operate in 13 countries across asia, with total foreign assets expanding from only usd1 billion ringgit to more than usd100 billion between the period 2002 and 2010. our payment and settlement systems are also being linked to facilitate more cost - effective crossborder and efficient investment flows. efforts are currently underway to establish a pan - asian central securities depository alliance which will provide seamless accessibility to asian securities by international investors. the acceleration of regional financial integration in asia is contributing to the more effective intermediation of funds from the region to be channeled towards meeting the investment bis central bankers ’ speeches requirements of the region. over the next decade, asia ’ s projected infrastructure development expenditure alone will be twice the estimated savings within the region. this provides investors with new investment horizons and significant diversification opportunities. in charting the future for a more integrated asia, the developments surrounding the sovereign debt crisis in europe provides us with important lessons. despite having common rules and established institutional arrangements, achieving consensus and coordination have proven to be a major challenge in an environment in which there are also many national priorities. these differences in priorities become even more pronounced during a crisis. given that asia is a far more diverse region, a different approach to economic and financial integration is being pursued. the aim is to put in place elements that will facilitate the deepening of trade and investment linkages within asia while also collectively working towards strengthening asia ’ s resilience and stability. asia ’ s economic transformation, comprehensive financial sector reforms and fiscal prudence have provided important support to asia ’ s resilience and ability to withstand the destabilising spill - over effects of the current ongoing global financial and economic crisis. in addition, the regional surveillance mechanisms are being reinforced by financial support facilities and an integrated framework for crisis resolution. every financial crisis has prompted a review of the role, function and authority of central banks. indeed, developments in this recent four years have had profound implications on the central banks of crisis affected countries. the mandate of central banks for financial stability has generally been strengthened considerably to deal more effectively with risks in

process for greater interface among regulators becomes important, including that involving cross border interface. for the asian region, the east asian central banks have since 2007 established a monetary and financial stability committee to discuss assessments of risk and vulnerabilities to macroeconomic and financial stability in the region. the strategy for policymakers in asia has been to build a higher degree of resilience to be better positioned to withstand external shocks and to provide an enabling environment to achieve a sustainable economic performance. for central banks, the focus is on preserving monetary and financial stability. of equal importance is the development of the domestic financial infrastructure. important in the policy design of central banks is that the policies are anticipatory. delays in policy action or exit will invariably result in higher costs, over adjustment and other unintended consequences. a second aspect of policy is that rule based policies such as inflation targeting does not give the policy space to take into account sources of instability and other trends that may work to diminish the extent of such instability. rigid parameters, imposed by multilateral agencies and sometimes by rating agencies and the market also contribute towards reinforcing these conventions. current and future conditions are likely to be highly complex and varying and therefore not lending itself to rigid rules. in an environment that will continue to remain challenging for some time, this conference provides an important opportunity to discuss a wide range of issues from asia ’ s perspective, thereby contributing to the international discussions and understanding of the issues and their business and policy implications. asia ’ s experience will also provide additional insights in contributing towards the solutions for building a more resilient international financial system. i wish you an engaging and productive discussion. bis central bankers ’ speeches