of shari ’ a scholars which includes some of the industry ’ s most prominent and widely respected scholars. while the iifm documentation brings a more rigorous and robust architecture to the development of islamic derivatives, it should be seen as merely the beginning of the process. much more work will be required to ensure that standardised contracts for other islamic financial products can be developed which have the support of the great majority of shari ’ a scholars. within the past 12 months, a new dimension to the legal uncertainty of islamic financial contracts has arisen. since the global financial crisis began, we have seen the first defaults on sukuk. these defaults have raised a number of difficult legal questions which are currently before the courts. in particular, they raise questions about the rights of the sukuk holders in the event of a default by the issuer and in particular whether they have a claim on the underlying asset. it is important that these cases are resolved rapidly and that they create clear precedents and mechanisms for handling defaults in future as otherwise the lack of legal certainty will act as a drag on the development of the sukuk market. the second set of issues relate to risk management. this has a number of different dimensions, but two in particular are worth highlighting. the first relates to liquidity risk. the conventional financial industry received a wake - up call during the crisis concerning the importance of understanding, monitoring and controlling liquidity risks. the islamic financial industry must recognise that it too needs good liquidity risk management. how islamic financial institutions can manage their liquidity risk given the relative absence of short - term money market instruments has been a problem for the industry for some time. however, the events of recent years should give a greater sense of urgency to resolving these problems and we need to redouble our efforts to find a solution. a second area of risk management to which islamic institutions need to give some attention is the problem of limiting the concentration of risk in particular economic sectors or asset types. the industry ’ s preference for a real asset to back financial transactions has, unfortunately, resulted in a relatively high concentration of risk in real estate. as a result, many islamic financial institutions have asset portfolios which are concentrated on this potentially very volatile sector. the performance of real estate markets in north america, europe, and in certain parts of the middle east in recent years have highlighted the risks of excessive concentrations of lending to this sector. it is important that in future the islamic financial industry should find

claudia buch : introductory statement - public hearing at the european parliament concerning the position of chair of the supervisory board of the european central bank introductory statement by prof claudia buch, vice - president of the deutsche bundesbank, at the public hearing at the european parliament concerning the position of chair of the supervisory board of the european central bank, brussels, 20 september 2023. * * * check against delivery. dear madam chair, honourable members of the european parliament, it is a great honour and privilege to appear before you today. i would like to share my vision for the ssm, following my nomination by the ecb as chair of the supervisory board. the european parliament is a crucial ally for supervisors. the ssm ensures the safety and level treatment of all banks in the banking union – in the interest of european citizens. you provide the framework for the banking union and its single rulebook. and you hold ecb banking supervision to account – for me, this is key to ensuring the democratic legitimacy of supervision. as chair, i would be strongly committed to continuing the close cooperation with the parliament. i would be devoted to serving the european public good by taking direct responsibility for europe, and being a strong voice for completing the banking union. i would bring with me to the role a broad range of international experience in micro - and macroprudential oversight. as vice - president of the bundesbank, i am responsible for banking supervision and financial stability. i am a member of the ecb's supervisory board and serve as the bundesbank's g7 and g20 deputy. i can therefore contribute a comprehensive micro - and macro - level perspective. and i will continue to work with all my strength on the european project. the ssm has been very successful during its first decade, and it is well equipped to deal with upcoming challenges. it has made european banks safer and stronger. this is essential for sustainable growth. the ssm has built a culture of joint supervision across europe, and i can testify to the excellence of its staff. this is a strong foundation. 1 / 3 bis - central bankers'speeches i see three priorities for the future work of the ssm : adapting supervision to the new, more unpredictable environment ; strengthening supervision by making it even more proactive ; and continuing the good cooperation with all stakeholders. let me explain. * * * my first priority as chair would be to adapt the ssm to the changing environment. as supervisors, we need a