ambiguities and possible breaches of the contract will enhance competitiveness, both at the institutional level as well as for the financial system as a whole. in malaysia, islamic finance disputes are adjudicated in civil courts and not the shariah courts where the jurisdiction is limited to matters relating to muslim individuals. if the dispute concerns a point on the ascertainment of shariah, the courts and arbitrators are required to refer to the shariah council at bank negara malaysia to facilitate the ruling. the shariah councila€™s authority is the ultimate body responsible for shariah in banking and financial matters that is within the purview of bank negara malaysia. this referral system provides an enabling platform for preserving consistency and predictability in interpretation and application of shariah principles for financial transaction in malaysia. concluding remarks allow me to now conclude my remarks. the inherent strengths of islamic finance amid the global financial crisis has heightened interest in islamic finance across the world. the level of innovation, scale and complexity of islamic financial transactions is also increasing at a tremendous pace. going forward, it is envisaged that the legal services in islamic finance will become even more significant in the continued advancement and efficiency of islamic finance. in this regard, your thought leadership in addressing the legal issues embedded in islamic finance holds important element in the continued growth of the islamic financial services industry. here, i would like to take this opportunity to congratulate the islamic financial services board for organizing this timely seminar. i trust it will continue to be a constructive platform for the legal and industry practitioners to deliberate on effective and pragmatic solutions to the legal issues in islamic finance. on this note, i wish all of you a productive and successful seminar.

zeti akhtar aziz : legal issues in the islamic financial services industry speech by dr zeti akhtar aziz, governor of the central bank of malaysia, at the 4th ifsb seminar on legal issues in the islamic financial services industry, kuala lumpur, 28 september 2009. * * * it is my great pleasure to speak at this 4th ifsb seminar on legal issues in the islamic financial services industry that has brought together so many international experts and industry practitioners to discuss legal issues in islamic finance. such dialogue is important to achieving a common understanding and solutions to issues in islamic finance, thus contributing to its overall development. islamic finance has continued to expand and demonstrate its resilience in the current more challenging international financial environment. this advancement has been in terms of the increased range of islamic financial products and services, the development of the islamic financial infrastructure and institutions, the greater maturity of the islamic financial markets and the more comprehensive supporting legal and regulatory framework. more recently, the international dimension of islamic finance has gained significance with the move to further liberalise domestic islamic financial system and the strengthening of the international islamic financial architecture. in malaysia, islamic banking assets at the end of the second quarter of this year, now constitutes close to 19 % of total banking assets. total financing now amounts to rm118 billion and accounts for 20. 1 % of the total financing portfolio of the banking industry. net nonperforming financing remains low at 2. 4 %. islamic securities has also maintained its dominance in the malaysian bond market, accounting for 58 % of total bond market. and almost two thirds of the equity market comprises shariah compliant securities. growth has also been experienced in the takaful sector in which the funds asset has registered an increase by 8. 2 %. this recent decade has also seen the increase in number of islamic financial institutions including full - fledged islamic banks, development financial institutions that engage in islamic banking, takaful, re - takaful and capital market intermediaries. several of these players have strategic partnerships with foreign players. in april this year, as part of the liberalization initiatives announced, new mega islamic banking licenses and up to two family takaful licenses will be issued this year. on the global front, islamic financial assets are projected to grow to usd1. 6 trillion by 2012 while the global sukuk outstanding valued to date at approximately usd152. 8 billion. in the third series of this seminar in 2007, the vital role of a strong