working life, up to at least age 55 to supplement their retirement income. this is a great opportunity and challenge for the trust industry to design product choices that conform faithfully to the laudable objective of this new law. further, the improving economic prospects also set the stage for progressive liberalization of our foreign exchange regime to allow for greater flexibility in overseas investing. this should provide professional fund managers the necessary room to maneuver the diversification of their portfolios and to access a richer variety of qualified assets …. for the benefit of their customers. ladies and gentlemen. the reform agenda must be pursued vigorously …. if we are to secure the opportunities. at the financial market level, the bsp is closely collaborating with key market players through their respective industry associations, as well as with our fellow regulators particularly the sec ….. to achieve more transparent and investor - friendly markets. it is in this context, that we welcome the recent launch of the new government securities benchmark system that can promote fair price discovery, more effectively. we expect the trust industry to work within this new system so we can achieve full transparency and comparability of performance. the new benchmark should also assist in properly valuing debt securities and other financial products like derivatives, repos, as well as securities borrowing and lending arrangements … and thus promote their acceptability to the market. as the galaxy of available domestic capital market assets expands and the market deepens …. it is the trust industry that will be a clear winner. we are also working hard to constantly improve the payments and securities settlement systems. it is basic that we aspire to fully achieve efficient dvp settlement in all securities transactions …. in line with global standards in the area. this is critical to both investor protection and market stability. we also need to work closely to reform the trust industry itself. in that spirit, we are devoting dedicated resources at the bangko sentral … through our newly formed trust supervision group … to work closely with toap. their priorities include ( 1 ) basic trust department operating standards ; ( 2 ) risk management guidelines ; ( 3 ) trust department rating system ; ( 4 ) specialized examination procedures ; and ( 5 ) improvements to uitf regulations. at a more fundamental level, we are also reviewing the basic governance arrangements of the trust department …. as an entity within the bigger banking organization …. to minimize potential conflicts of interest, while preserving natural business synergies. this includes a closer look at the composition of the trust

committee and a clearer articulation of their duties and responsibilities for good governance. also in scope are the qualifications of trust officers and the proper definition of their duties and responsibilities. the basic operating standards are designed to ensure consistency in the administration and operation of trust and other fiduciary business and investment management activities to better promote investor protection. the standards cover significant areas of trust operations and set forth the minimum array of procedures – from account acceptance to termination, aimed at further professionalizing business conduct across all practitioners. on the other hand, the risk management guidelines will be formulated to identify, manage, and control specific risks in the trust business. in tandem with the basic standards, the risk management guidelines will enjoin trust entities ’ total adherence to the cardinal principles of prudence and utmost care. a rating system for the trust unit … analogous to the camels rating system for bank proper.... is being formulated to independently assess their performance, given their special fiduciary responsibilities. to tie everything up, new specialized examination procedures are being drafted for trust operations …. to basically align these with the risk - based approach and to incorporate compliance with the basic standards and risk management principles. finally, the uitf regulatory framework will be reinforced to cover the following : ( 1 ) improved certification program for uit marketing personnel ; ( 2 ) additional guidelines to standardize uit performance reporting for marketing purposes ; ( 3 ) enhanced risk disclosures and client suitability profiling ; ( 4 ) updating of major template documents like the declaration of trust to incorporate amendments to the regulatory framework ; and ( 5 ) corporate governance structure of uits such as the possible separation of trustee and fund manager functions or alternatively, the strengthening of present combined function arrangement …. as these matters have evolved in global best practice. ladies and gentlemen. all these trust reforms are building blocks that should help us nurture a truly competitive and dynamic trust industry that is responsive and supportive of a growing economy. this we owe to our country and our people. let us therefore take heart that even as we continue to face challenges … the opportunities ahead give much promise, especially to those who will adhere faithfully to the tenets of good governance. remember : fairness, accountability and transparency. on this upbeat note, i greet you all …. aloha! thank you all and good evening.