the strong current account surplus will persist for the entire forecast period, which extends until 2018, in part because national saving will remain above the historical average. in this context, we must bear in mind that things can change quite suddenly. it is also worth noting that numerical economic forecasts, by their very nature, have a tendency to be much more stable than historical reality. in the recent past, we have reaped the benefits of developments abroad, but we do not know how long this will last, and tailwinds could turn into headwinds. history also tells us that we have a tendency to make economic policy mistakes during booms and mistake temporary positive shocks for permanent improvements. if history repeats itself, domestic demand and inflation could increase more than is assumed in the forecast. we must therefore be vigilant and be careful when taking the decisions that lie ahead. the central bank ’ s next comprehensive analysis of economic developments and prospects will appear in monetary bulletin in mid - may. honoured guests : as has been reported, the central bank bought large amounts of foreign currency in 2015 and has continued to do so this year. from may 2013, when the bank began its regular fx purchase programme, until the close of business yesterday, the bank was a net buyer of foreign currency in the amount of 471 b. kr. some of this currency has been used to pay down foreign debt and the rest to increase the size of the foreign exchange reserves. both of these measures increase the proportion of the reserves financed in kronur. at the end of february, the reserves totalled 721 b. kr. including 382 b. kr. financed in kronur. this has reduced foreign liquidity risk, of course, but it would also have a large negative impact on the bank ’ s finances if such an arrangement persisted, as domestic interest rates are much higher than the rate of return on the reserves. this point is discussed in greater detail in the bank ’ s annual report, which is available here today. the report states that, as of year - end 2015, the negative interest rate differential on the bank ’ s foreign exchange balance was 18 b. kr. on an annualised basis. the forthcoming auction of offshore kronur could change this position radically, however, and as a result, there is no reason to despair about the central bank ’ s finances. furthermore, it is at the core of central banking to prioritise macroeconomic objectives over the

of the industry. it involves educating consumers on the key attributes of takaful, having great reverence for and understanding of consumer needs, ensuring that consumers are suitably advised in the marketing process to make informed decisions as well as treating consumers fairly. it needs no convincing that such high standard of market conduct is essential in maintaining public confidence, the lack of which will undoubtedly compromise industry ’ s reputation. equally important is the imperative to ensure that shariah compliance remains at the heart of governance and business operation. this calls for accountability on the part of takaful operators to institute robust shariah governance framework within their organisation. the enhanced shariah governance framework issued by bank negara malaysia for the islamic financial services industry recently aims to achieve this objective. it is envisaged that the enhancements made to the framework will lead to improved oversight, authority and accountability of key shariah organs and greater shariah observance through an end - to - end shariah control mechanisms, thereby strengthening the overall shariah governance processes within islamic financial institutions. through its effective implementation, the framework lays the foundation for an islamic financial institution to align shariah with the organisation ’ s strategic orientation, in guiding shariah compliance as an embedded culture within the organisation, beyond merely product design function to all other aspects of its day - to - day business operation. given that effective shariah compliance is the cornerstone of the aims and objectives of an islamic financial institution, takaful operators will find that such an approach that optimises and harnesses the strength of shariah will manifest itself as a source of competitive edge for their organisation, whilst contributing immensely towards preserving the integrity of the islamic financial services industry. with our steadfast commitment to continually enhancing the dynamism and competitiveness of the takaful industry in malaysia, i am confident that the takaful industry is on - track for quantum leap performance in this next phase of growth and development. on this note, it is my great pleasure to congratulate ing public takaful ehsan on its successful launch. i wish ing public takaful ehsan every success in its endeavors and look forward to its meaningful contribution in driving the takaful industry and islamic finance in malaysia forward. bis central bankers ’ speeches