the banking industry is about rm2. 4 billion annually. this is sheer wastage when a cheaper alternative is readily available. there is substantial room for our banks to strengthen their operational efficiency through rationalization of business model and internal processes by emphasizing the use of epayments, instead of the more manually - intensive paper - based payment methods. this would enable banks to achieve a lower cost - income ratio, thus enhancing productivity and competitiveness. for this to happen, it is critical that, banks should upgrade their management information system ( mis ) to fully capture the cost of different payment methods and identify areas with potential for greater operational efficiency. in addition, banks should foster better coordination between their respective revenue and cost centres to achieve optimal financial performance. this should be complemented with an incentive structure within each bank that not only rewards revenue generation but also cost reduction. payment system infrastructure providers basic payment infrastructure should be viewed as a form of ‘ utility services ’ such as electricity, telephone and broadband lines, where it is regarded as a key enabler for innovation. hence, access to payment infrastructure should be made as open and as affordable as possible. the bigger the network of a payment infrastructure, the more value it can bring to its participants in terms of economies of scale and multiplier network effects. payment system infrastructure development should be shared and not be regarded as a competitive tool as investments in this space is expensive and continuous. therefore, payment system infrastructure providers such as meps and myclear should collaborate more effectively to avoid duplication and wastage. in addition, meps and myclear should also collaborate and put in place common payment system infrastructure that would benefit all stakeholders. the recent collaboration between meps and myclear under the malaysian chip card specification ( mccs ) initiative to migrate the domestic debit card to the europay - mastercard - visa ( emv ) standard and contactless feature is a step in the right direction. bis central bankers ’ speeches moving forward, meps and myclear should jointly identify areas for strategic cooperation, with a clear line of sight to the future, to ensure that payment system infrastructure in malaysia continue to keep pace with innovation and meet user needs. merchants and consumers with increased transparency in payment services brought about by the various regulatory and industry measures, merchants and consumers alike should leverage on expanded information disclosure to get the best deals that suit their requirements. a smart consumer will drive competition and reduce costs over the long run processing payments and account reconciliation manually is a

deeper support to china ’ s growing connectivity with southeast asia. let me cite four concrete areas of partnership. • capital management • risk management • infrastructure financing • asset management capital management chinese enterprises have mostly relied on domestic sources of funds such as bank lending to finance their international expansion. many chinese companies have also listed in equity markets in the us, hong kong and singapore. but as chinese companies grow their global presence, they will have to think harder about how best to raise capital and how best to make use of their capital by tapping into offshore markets. first, bond markets offer a useful alternative to bank lending, especially for long - term funding. deep capital markets, anchored by a large institutional investor base can help well - rated businesses to achieve efficient cost of funding. chinese companies are becoming more active in singapore ’ s bond market. • for instance, china oilfields services limited successfully raised us $ 1 billion in singapore last year, including a 10 - year medium - term note of us $ 500 million. second, chinese corporates with income - producing real estate and infrastructure assets could recycle their capital by securitising these assets through a trust vehicle. bis central bankers ’ speeches • sgx saw its first china real estate investment trust or reit last year, with beijing hualian group raising close to s $ 400m through a reit. similarly, chinese banks can use loan securitisation to recycle bank capital and re - channel the funds to real economic activities back home. • icbc ’ s opening of its asia pacific shipping finance centre is a good example of this. • the centre will help icbc singapore securitise its shipping and related loans originated in the asia pacific, by tapping the singapore bond market. risk management as chinese corporates continue to venture abroad in asia, they will confront a variety of risks. these risks need to be managed well. first, there are the usual foreign exchange and interest rate risks. • as the largest fx market in the asia pacific, singapore offers chinese corporates effective fx hedging solutions to manage their risk exposures. • the singapore exchange has a strong suite of fx futures contracts, including asian currencies, and the take - up rate has been strong. • many corporate treasurers have chosen singapore for their regional treasury centres covering southeast asia, and even the greater china region. second, some of the investments by chinese corporates could be in locations that are vulnerable to natural disasters. • investors would need