since the crisis, they have even begun to build a banking union, which includes a single supervisor. but when it comes to regulation, we still see differences between countries. it is true, of course, that we have a single rulebook in europe. as one might expect for a union, 1 / 4 bis central bankers'speeches we had to come further than other countries. however, parts of that rulebook come in the form of eu directives. and these still need to be transposed into national law, which explains some of the differences we see. so regulation in the euro area remains fragmented. but this runs counter to the idea of “ same business, same risk, same rules ” ; and it runs counter to the idea of the european banking union. so there is a clear case to be made for further harmonising the rules. we need a well - written rulebook to keep risks in the banking sector in check. but rules are just one of the pillars that support a stable banking sector. the second pillar is supervision. and here we need to strike a delicate balance because these two pillars interact in a subtle way. the general idea is that rules create the foundations for supervisors to do their job. there is a danger, though. if the rulebook becomes too detailed, it might wall supervisors in and limit their options too much, rather than provide them with solid foundations. and this can happen fairly quickly. by way of example, just think of speed limits. let ’ s say you want to set a speed limit for motorways. does 120 kilometres per hour sound about right? at first sight, this is a very simple and straightforward rule. but then you start to think – what if there ’ s a sharp and dangerous bend in the road? wouldn ’ t that call for a lower speed limit? and what if the road becomes slippery when it rains? perhaps the speed limit should depend on the weather? and shouldn ’ t it also depend on the kind of vehicle? one could easily think of many more questions like these. so even a seemingly simple rule can quickly start to become more and more complicated. the world is complex and uncertain, particularly when it comes to finance and banking. that leaves us with two options. either we come up with more rules to try to cover every potential situation. or we allow supervisors some discretion within a set framework and let them judge specific situations on their merits. in the end, these two options need to be in balance, and we

months. malaysian of retirement age and older are particularly vulnerable. based on statistics from the employees provident fund in 2011, more than 70 percent of contributors who were 54 years old at the time had savings of only rm50, 000 or less accumulated for retirement. only 30 % of these contributors were still working. with a reported average life expectancy of 75 years, many malaysians are clearly at risk of not being able to meet their financial needs during retirement. the low level of financial literacy among malaysians, especially in appreciating the importance of risk diversification and reduction, and how to use financial instruments effectively to achieve this, has further compounded the problem. taken together, these observations underscore the tremendous opportunity that exists for financial advisers to raise the game in quality of advice, and in educating malaysian households on the effective use of insurance and takaful as a financial management tool. financial advisers are well - placed to provide lifelong financial planning support to malaysian individuals and households in an environment of a growing middle class segment with higher purchasing power. to do this, gaining public trust and confidence is critical. today, i think you will agree with me that that level of trust and confidence in insurance intermediaries at bis central bankers ’ speeches large remains below where it could and should be. an important starting point has to be a mindset that puts a client ’ s needs at the centre of advice and product recommendations, and which is firmly focused on helping the client to achieve his financial and life goals. this implies a view to developing lasting and durable partnerships with clients, and investments to build and maintain a high level of competence among financial adviser representatives who can tailor advice and tackle a broad range of consumer needs and profiles. importance of sound advice access to sound financial advice has become even more important today as households face the challenges of managing heavier debt loads, higher costs of healthcare and education, effects of natural calamities that are occurring with greater frequency, and longer life spans. we believe that the responsibility to provide sound advice falls on all insurance intermediaries, whether you are an agent, an insurance broker, a bancassurer, or a financial adviser. this is clear in our guidelines on proper advice which states among other things, that if an intermediary cannot match the needs and requirements of a customer with a life or takaful product within the intermediary ’ s offerings, the intermediary should not recommend any product to the consumer. however, we are