the appropriate way to address effectively the consequences of the adverse economic environment. the russian invasion in ukraine has elevated further the importance of climate risk due to its interconnectedness with geopolitical risk. the ongoing effort to reduce the dependence on russian energy frontloaded the need to reduce carbon emissions and move promptly towards a greener economy. the banks have a key role to play in this effort through financing the transition as well through providing adequate disclosures to the markets. we therefore expect them to adopt both their business models and risk 1 / 2 bis - central bankers'speeches management frameworks to incorporate climate and environmental risks. the fact that certain banks have started making tangible steps in this regard is a positive development, but there is still some way yet to be travelled. the management of climate risk by banks is on the top of the supervisory agenda. we acknowledge the challenge that this poses especially for smaller banks. however, we do expect them to act more decisively in the said direction. by default, this will ultimately also target the banks'clientele and the submission of detailed climate related information in order to feed the banks'risk management processes. the challenges noted above, require significant up - front investment before reaping the benefits. the banks should proceed without undue delays to the transformation of their business models to address a new challenging business environment. complacency emanating from short term profits is not a viable option. sustainability through transformation is the way forward. thank you. 2 / 2 bis - central bankers'speeches

yaseen anwar : role of financial institutions and capital markets in pakistan ’ s economy speech by mr yaseen anwar, governor of the state bank of pakistan, at the paf air war college, karachi, 21 december 2011. * * * the commandant paf air war college, members of the faculty and the future leaders of the armed forces i am delighted to be invited by the paf air war college which is one of our premier institutions of the armed forces of pakistan, to share my views on the role of financial institutions and capital markets in the pakistan economy. the importance of financial institutions ( fis ) cannot be overemphasized. fis perform the vital function of intermediation between providers of investable funds ( depositors, securities holders etc ) and the users of such funds ( namely businesses ). no economy can progress unless its financial sector facilitates its business activity consistently, and in the case of a developing country like pakistan, these fis act as a necessary catalyst for economic growth as well. the state bank of pakistan, as the central bank of a developing country, has played two very critical roles with respect to the financial sector. firstly it ensures soundness of banks and dfis through prudential oversight with a view to maintain financial stability ; secondly it pursues a developmental objective under which it facilitates financial markets developments and enhancement of access to finance. over the years much has been accomplished, yet a lot more is yet to be achieved. the banking system, which constitutes 88 percent share of the total financial sector, is comprised of 34 commercial banks and 4 specialized banks. the share of non - bank financial institutions is approximately 12 percent, and includes leasing companies, mudarabas, insurance companies, investment banks, housing finance companies, venture capital companies, and mutual funds. the banking sector of an economy is generally the most significant player and performs three primary functions which include the facilitation of the payment system, mobilization of savings, and allocation of loanable funds. by virtue of its pivotal role, the banking sector can exert its positive influence on various other segments of the economy. during the course of my speech, i would be giving you a historical perspective of the development of financial sector in pakistan, followed by a discussion of challenges and opportunities of present scenario. finally, i would like to share with you our priorities related to the banking sector for the future to come. historical perspective the current structure of the financial sector in pakistan is the result of several policy shifts