##ntial, or systemwide, approach that should help us better anticipate and mitigate broader threats to financial stability. although regulators can do a great deal on their own to improve financial regulation and oversight, the congress also must act. we have seen numerous instances when numerous studies confirm these points. see, for example, group of thirty ( 2009 ), financial reform : a framework for financial stability ( washington : group of thirty, january ) ; markus brunnermeier, andrew crockett, charles goodhart, avinash d. persaud, and hyun shin ( 2009 ), " the fundamental principles of financial regulation ), " geneva reports on the world economy – preliminary conference draft ( geneva : international center for monetary and banking studies, january ) ; the de larosiere group ( 2009 ), the highlevel group on financial supervision in the eu ( brussels : european commission, february ) ; financial services authority ( 2009 ), the turner review : a regulatory response to the global banking crisis ( london : fsa, march ) ; international monetary fund ( 2009 ), global financial stability report : responding to the financial crisis and measuring systemic risks ( washington : imf, april ) ; and u. k. parliament, house of lords, select committee on economic affairs ( 2009 ), banking supervision and regulation, h. l. paper 101 - i and h. l. paper 101 - ii, session 2008 - 09 ( london : the stationary office limited, june ). weaknesses and gaps in the regulatory structure itself contributed to the crisis, many of which can only be addressed by statutory change. notably, to promote financial stability and to address the extremely serious problem posed by firms perceived as " too big to fail, " legislative action is needed to create new mechanisms for oversight of the financial system as a whole ; to ensure that all systemically important financial firms are subject to effective consolidated supervision ; and to establish procedures for winding down a failing, systemically critical institution without seriously damaging the financial system and the economy. in the rest of my remarks, i will elaborate on each of these areas. strengthening regulations and guidance first, i would like to report on changes already under way to strengthen the regulatory standards that limit the risks taken by financial firms and establish the capital and liquidity buffers that they must hold. through the course of the crisis, it became increasingly clear that many firms lacked adequate capital and liquidity to protect themselves as well as the financial system as a whole.

our competitive advantage in islamic financial markets and move beyond our previous focus of advisory and promoting primary market issuances and move up to build an end - to - end value chain capability – where we should also focus on secondary market trading, settlement and custody services. but this aspiration of ours could only be achieved if there is a collaborative effort between the industry and the authorities. one such platform is the malaysia international islamic financial centre ( mifc ) initiative that comprises a community network of the country ’ s financial and market regulators, including bank negara malaysia ( central bank of malaysia ), securities commission malaysia, labuan financial services authority and bursa malaysia ( kuala lumpur stock exchange ) ; government ministries and agencies together with industry participation from the banking, takaful, capital market institutions, human capital development institutions and professional services companies which are participating and working collaboratively in the field of islamic finance. the creation of international islamic liquidity management corporation ( iilm ) recently was the outcome of the high level taskforce on liquidity management that was formed by the islamic financial services board ( ifsb ). it is a collaborative effort to develop a liquidity framework that can provide widely acceptable liquidity solutions to islamic financial institutions, to promote better liquidity management. iilm will be an issuer of shariah compliant financial instruments that are highly liquid and tradable in the secondary financial market. this is an important infrastructure capacity building since it would expand the scope of business for islamic finance globally and was achieved through collaborative effort. another initiative is the creation of a sukuk investment fund – foreign currency funds to be disbursed to selected islamic fund management companies ( ifmcs ) to invest primarily in foreign currency sukuk issued out of malaysia. the fund would support the proliferation on the buy side for the issuance of sukuk out of malaysia, besides providing a platform for the islamic fund management industry, including start - ups to build their track record in managing foreign currencies fund denominated. complementary to this initiative is the creation of a malaysian - based sukuk index for foreign currency and also an extension of our domestic settlement capabilities to include foreign currency securities. this is the moment when we need the cooperation from the private sector in support of government ’ s measures to generate business and to stimulate the economic growth. there are enormous opportunities for the industry to benefit from these initiatives. the strengthening and the transformation of the financial sector contributed by financial deregulation, opening of