core savings of these groups, promote financial inclusion and contain excessive leverage should also form an integral component of the resolution and reform agenda. given the high costs of financial crises there is now a better appreciation of the need for such policies to co - exist with free markets, working to efficiently allocate economic capital to achieve more sustainable outcomes. while significant challenges continue to confront several of the advanced economies as they seek to address the structural problems that remain unresolved, asia must chart its own path in formulating strategies to develop our economies and financial systems. following the asian financial crisis, most emerging economies in asia have strengthened their economic and financial fundamentals, improved their fiscal and external debt positions, and reformed their banking sectors. this has supported our economies through the recent global financial turmoil. with a significantly stronger foundation, asia has now every potential to meet its growth and development goals in a manner that avoids the pitfalls that will undermine our future prospects. this morning, i would like to focus my remarks on five factors that i believe will serve to anchor sustainable growth and stability in asia going forward. bis central bankers ’ speeches supporting sustainable growth and stability in asia first is that the growth of the financial sector in asia remains largely anchored in productive, real economic activity. in contrast to developments in recent years, financial innovation in asia has mostly served to support the legitimate financing, investment and risk management needs of businesses and households. the growth of the financial sector has not significantly outstripped economic growth and new innovations in financial products and services have not taken on the degree of complexity and high leverage observed in the economies that were affected by the crisis. financial institutions in asia also had limited exposure to highly leveraged activities, such as complex derivatives and structured credit instruments. consistent with the more traditional banking models in asia, there are now calls for a return to basic banking and its clear separation from higher risk - taking activities. the growth of islamic finance, with its emphasis on the close link between financial transactions and real economic activity and which embraces universal values such as transparency and fairness, further supports this trend. the emphasis on productive financial innovation has also been reinforced by a long standing focus in asia on promoting effective consumer protection arrangements. in the recent period, this has received renewed attention by authorities given the experience of the recent crisis which has underscored how market conduct failures that led to widespread mis - selling and predatory lending, was not only detrimental to consumers, but also a source of systemic risk. an emphasis on product transparency

muhammad kamran shehzad : combating corruption in the banking sector keynote address by mr muhammad kamran shehzad, deputy governor of the state bank of pakistan, at the seminar on collaboration of banking sector and financial institutions with the national accountability bureau ( nab ) in combating corruption, karachi, 5 october 2010. * * * ladies and gentlemen, it is my pleasure and privilege to address this august gathering of eminent bankers, financial experts and other stakeholders. let me first state clearly that coordination & co - operation of the banking sector as well as regulator with national accountability bureau is of prime importance in combating corruption and corrupt practices in the banking sector. the majority of banking cases are white color crimes done in such a professional manner that their detection and subsequent preparation of strong cases is an uphill task. even in the developed economies prevention of white colour crimes, remains a big issues to tackle. in pakistan corruption is a major cause of concern in majority of public sector organizations which has weakened their strength and efficiency and thus they have become a burden on the exchequer. the critical factor behind such failures are mis - management, bad human resource management, immorality, in efficiency and greed. corruption reduces the welfare activities of the society due to loss of efficiency and effectiveness, reduction of the revenue available for development work and thus weaken the system. ladies and gentlemen, the behavior and culture of banking sector has altogether been changed in the last two decades. it has transformed itself from 85 % in public sector in 1990 ’ s, to present more than 80 % in private sector. this quantum change has been taken positively & supported by the state bank. the newly transformed private banking sector is performing responsibly and cooperating with regulators and investigating agencies for eradication of banking crimes. sbp and nab since its inception in collaboration with each other had agreed on a joint mechanism through which information required for investigation purposes from banking sector, under section 19 of national accountability ordinance, 1999, are obtained through sbp in the greater interest of the fragile economic conditions of the country. although nab has absolute powers to obtain these information directly from the banking company yet the collaboration was made to repose confidence in banking community. a dedicated nab cell at sbp was established which effectively coordinates with banks / dfis to ensure expeditious supply of information. the whole process is aimed at facilitating the bureau in discharge of its responsibility of vital national interest, without unduly disrupting the financial institutions