banking services reach especially to rural areas to help drive increased domestic savings. 5. in this regard, it is imperative for stakeholders to explore mechanisms to deliver financial services and push forward the financial inclusion frontiers in tandem with vision 2030. as a first step in pushing the initiative forward, the banking act was amended through the finance act 2009 permitting banks to use third parties ( agent banking ) to provide certain banking services on their behalf. i take this opportunity to urge banks to take advantage of the new provision. the agent banking model was designed to assist banks to lower their cost of offering banking services while at the same time improving their earnings as more kenyans are offered an opportunity to access financial services. 6. the kenyan banking sector continues to perform well despite the global financial turbulences and challenges on the domestic front. the sector ’ s total assets increased by 21 % from ksh. 1. 20 trillion in march 2009 to ksh. 1. 45 trillion in march 2010 whereas deposits increased by 23 % to ksh. 1. 14 trillion over the same period. profit before tax for the sector increased by 33 % from ksh. 12. 8 billion in the first quarter of 2009 to ksh. 17. 0 billion in the first quarter of 2010. this is remarkable, especially against the backdrop of domestic shocks and global financial crisis. 7. despite the impressive performance by banks, customers still have to contend with high borrowing costs. although many banks have responded to central bank ’ s plea of lowering interest rates, it is our expectation that all the banks should follow to support the economic growth via the support of expanded private sector credit at an affordable cost. on our part, we should now ask the real sector to access and negotiate credit in line with their potential investment. 8. finally, let me reiterate that central bank and indeed the government of kenya will continue to pursue policies that create a conducive environment for growth of the financial sector and encourage the provision of banking services to majority of the un - banked kenyan population at affordable cost. for us to be successful in this, we need to support strong institutional growth and remove underlying constraints that inhibit growth and financial reach. 9. with these few remarks ladies and gentlemen, it is now my honour and pleasure to declare the new brand of consolidated bank of kenya officially launched. thank you and god bless you all.

in their regulatory framework, and adoption of these standards in other countries will pave the way not only for shariah compliance but also product innovation. in addition, the central banks / regulatory agencies monitoring the performance of islamic financial institutions also need to establish their own shariah board for guiding them in formulation of policies and rules as well as for resolution of conflicting shariah opinions. vigilance and oversight of the supervisor. as in any conventional bank, the role of the supervisor is critical in ensuring smooth functioning of the institutions. the key element of shariah supervision is existence of a mechanism that ensures that the islamic financial system continues to remain viable and growing without compromising the principles of shariah. this leads me to share with you the experience of pakistan in the area of islamic banking. managing corporate governance in pakistan ’ s ifis is critical given the surge in their assets from rs6. 9 billion in cy02 to rs100 billion by end october, 2006, growing at an average annual rate of above 300 percent. growth in assets was well supported by a sharp increase in deposit base ; which increased from rs5. 0 billion in cy02 to rs70. 0 billion ( annualized growth rate of over 85 % ) by the end october, 2006. this rapid growth allowed ifis to increase their share in the overall banking industry to around 2. 6 percent. 3 positioning itself effectively the state bank of pakistan has established a dedicated islamic banking department ( ibd ) that operates in close coordination with policy and regulatory department and inspection and supervision departments to facilitate ifis development. the ibd coordinates with rest of the sbp and banking industry to provide valuable regulatory guidance related to overall shariah compliance and specific issues / challenges being faced by the islamic banks in pakistan. pakistan has adopted a three tiered, somewhat unique, shariah compliance mechanism and process to ensure a deeper and extensive shariah compliance supervision on an on - going basis. the shariah supervision mechanism consists of three basic elements. shariah advisors for banks undertaking islamic banking, a shariah compliance inspection and a centralized shariah board for the country at sbp. the first is appointment of shariah advisors at each bank undertaking islamic banking operations. the fit and proper criteria of the shariah advisor are determined by sbp. this criterion is, apart from the usual aspects of integrity and honesty, based on a person ’ s qualifications both in terms of education and experience