this direction. there are currently two islamic banks and 33 conventional banks with islamic windows offering the full range of islamic financial services, and the industry has recorded commendable growth at an annual rate of 48 % in terms of assets. at the end of march 2002, the assets mobilised by the islamic banking sector amounted to rm 59 billion. deposits and financing mobilized during the same period amounted to rm 48 billion and rm 30. 1 billion respectively. islamic banking in malaysia is now at the threshold of entering its next stage of development, to expand on a global basis, to gain greater acceptance as an effective and efficient means of intermediation and to contribute to the overall wealth creation. policies and measures will be formulated to not only increase the capacity and the capability of the islamic banking players but also to set the stage for malaysia to be an active player in global developments in islamic banking and finance. ladies and gentlemen, new players, new technologies, the push to globalisation and continuing deregulation are still driving change in the financial services industry. productivity, service quality, customer satisfaction and cost are key factors that drive the performance in a financial services organisation. in this uncertain world, the drive towards excellence can only be realised if strategic steps are taken today to enhance capability and capacity, thereby securing the well being of the banking industry and thereby the ability of the industry to contribute to the overall economic prosperity of our nation. on this note, ladies and gentlemen, i wish you a successful summit. thank you.

however, a slowdown is expected, and the financial crisis is likely to exacerbate the situation. israel ’ s banks were hardly exposed to the situation that developed in the international financial markets. nevertheless, israel ’ s interest spreads have widened, and if a serious slowdown in the us occurs, it is bound to affect israel ’ s economy too. the intensity of the potential impact on israel depends on us. therefore, it is imperative that the government continue to observe fiscal discipline, that the bank of israel continue to maintain price stability and to support financial stability, and that the banks continue with prudent, and particularly with cautious risk management. if all the above fulfill their functions properly, and if concurrently the business sector continues to display enterprise and to thrive, we will be able to continue to grow at a good pace, even against the background of some economic slowdown in the advanced economies. in the context of this strategy, our chances of achieving the main objective of economic policy will improve – to convert a high rate of growth into sustainable growth. such growth is vital to the future of the country, society, and the economy. growth has already improved the standard of living of the whole population in israel and of all its strata. as a result, the rise in the poverty rate halted in 2006, based on the relative measure of poverty ( which relates mainly to income differentials ) ; based on the absolute measure of poverty ( with relates to the ability to purchase a basket of basic goods ), poverty actually declined in 2005 and 2006. in addition, unemployment has fallen from its peak in 2003 at all educational levels, including the lowest, the rate of participation in the labor market has risen in all parts of the country, including the outlying ones, and the rate of employment of israelis and the average real wage has risen in all industries, including the low - technology ones. 2. the israeli banks what does this mean for israel ’ s banks? it is clear that economic buoyancy affects the banks. the financial position of the banks in israel has improved during the last few years, with regard to their profits, capital ratio, and the drop in the proportion of problem loans. israel ’ s economy needs the banking system to remain strong and robust. however, it was not only correct management that contributed to their success – the improved economic situation also played a part. therefore, i repeat the message that i delivered in my address last year ( it sounds better in yiddish ) : “ bad