zeti akhtar aziz : statistical science for a better tomorrow keynote address by dr zeti akhtar aziz, governor of the central bank of malaysia ( bank negara malaysia ), at the international statistical institute regional statistics conference 2014 “ statistical science for a better tomorrow ”, kuala lumpur, 18 november 2014. * * * introduction it gives me great pleasure to welcome you to this inaugural international statistical institute regional statistics conference. this conference takes place at a time of major transformative change in our region and in the world. the contribution of statistics in this new and rapidly changing environment has become of even greater importance. in this increasingly complex world, the availability of high quality statistics is vital in facilitating decision making for both the private and public sectors. the world is also seeing greater demands for higher levels of transparency. this has become key for building trust and confidence regardless of the line and nature of business. the statistics community has responded to these changes. immense progress has been achieved in developing the methodology for generating consistent economic and financial statistical systems. in a world that has also become more globalised, such progress has brought great benefits to businesses and policymakers in terms of the availability, comparability, and broad consistency of economic data across countries. for any economic and financial community, detailed and comprehensive data are highly important to understand the implications of the developments taking place. this has prompted greater international collaboration across the world to contribute towards a greater understanding of the implications of this trend. underpinning this is also the high level of professionalism and integrity of statisticians at national and international agencies. it is in this recent two decades, that the global economic and financial environment has become more interconnected, more complex and more competitive. it has resulted in greater economic and financial integration and more intricate interconnectivities. at the same time, the world has also become more unstable and less predictable with frequent shocks and crises. this new and more challenging environment has significant implications for business and for public policy. economic agents need to have an appreciation of the multi - faceted shifts in their environment in order to form the appropriate assessments and make informed decisions. for policy makers, it highlights the importance of having reliable, relevant and high - quality statistics to support and pave the way for sound policy decision making. for statisticians, the challenge is to continuously improve the statistical science towards facilitating the foundation to build a better future. my remarks today will be from the perspective of a central banker. timely and

ecb with an effective set of powers that encompass all the elements of the toolbox related to micro - prudential supervision. we can say that the ecb tasks would concern all the span of life of credit institutions, from their birth ( i. e. the authorisation to operate ) to their death. more specifically, the ecb will have the tasks to grant and withdraw authorisations to credit institutions, to assess mergers and acquisitions concerning credit institutions under its responsibility, to ensure the compliance with pillar i and ii requirements and, to carry out consolidated supervision. the ecb will be able to fulfil the tasks allocated to it both by using the direct supervisory and investigatory powers conferred by the ssm regulation, as well as asking for the assistance of national supervisory authorities as appropriate. at this point in time you may wonder what would be the consequences for your banks, once the proposed ssm regulation would be finally adopted and the new system will enter into force. an important point to stress is that the legislative framework agreed by the council bis central bankers ’ speeches ensures full continuity with the existing supervisory system. as i said, the ecb will carry out its tasks within the single supervisory mechanism, working together with national supervisory authorities. therefore, there would be no additional burden for the industry. on the contrary, banks are expected to greatly benefit from the fact that the ssm will facilitate the application of the single rulebook and thus likely reduce the compliance costs for banks with cross - border presence across the participating member states. the ssm and macro - prudential supervision another important element of the ssm regulation is the conferral on the ecb of macro - prudential tasks. let at this point, turn our view back for some years. in most countries, before the crisis, banking supervision was essentially “ micro - based ”. it was mostly focused on ensuring the safety and soundness of individual institutions while taking the rest of the financial system as given. the implicit assumption was that stable individual institutions would automatically deliver a stable system. this micro - based supervisory approach is likely to underestimate the systemic component and is not able to internalise and target the negative externalities that could build up as a result of increased risks for the system as a whole. the lending booms that we have experienced in some euro area countries before the crisis offer a good illustration : during the upswing banks reported high levels of profitability and low levels of measured risk. both of these