countries of the euro area, thereby preserving the singleness of the ecb ’ s monetary policy. the way forward : moving towards an integrated financial market union as i mentioned already, while monetary policy can alleviate deleveraging pressures in crisis times, it cannot address their root causes. in fact, to tackle the underlying problems, a wide - ranging policy response is necessary, inter alia, pertaining to public finances, economic competitiveness and the financial sector. given the focus of today ’ s conference, i would like to use the remainder of my speech to consider the last aspect, namely the institutional framework that governs financial markets in european monetary union ( emu ). in particular, i would like to address two questions : first, what principles should the institutional architecture be based on in order to be effective in avoiding excessive risk - taking and cross - border fragmentation of banking sectors ; and second, how do the on - going reform efforts towards a “ financial market union ” at european level contribute to these aims? in answering the first question, policy - makers should be guided by two criteria : first, economic actors that stand to gain from risky activity should also bear the associated downside risk. to be concrete, a system, in which banks can expect to be bailed out by taxpayers if their investment decisions go wrong, is neither efficient not fair. second, the bis central bankers ’ speeches institutional architecture of emu should achieve a level of integration that is commensurate to the integration of its banking financial sectors. hence, there should be no systematic cross - country differences in the design and implementation of the rules that govern financial markets. otherwise, such differences might become a source of financial fragmentation in their own right. neither of these criteria is easy to fulfil. as the experience with lehman brothers has demonstrated, failures of large, integrated financial institutions can have devastating consequences for economic stability. risks of contagion from one institution to entire financial sectors greatly complicate any effort to establish a more symmetric risk and rewardstructure for banks. harmonising financial sector policies across countries in turn requires substantial operational and legislative efforts, given that national institutions have evolved separately and are now heterogeneous in many regards. all these difficulties can be addressed and, in fact, they are being addressed by european policy - makers. in particular, the recent initiatives at european level comprise several crucial steps to achieving a more incentive - compatible as well as a more integrated and coherent framework among countries. let me elaborate

abdulrahman a al - hamidy : brief overview of the saudi arabian insurance industry speech by his excellency dr abdulrahman a al - hamidy, vice governor of the saudi arabian monetary agency ( sama ), at the first symposium on insurance, held at the institute of banking, riyadh, 22 – 23 march 2011. * * * it gives me pleasure to welcome you all to the first symposium that the saudi insurance industry has organized in collaboration with the institute of banking. i hope more such events will be organized to discuss future plans to expand insurance activities, and to set up mechanisms to improve the working environment of the insurance industry to enable it to serve better. dear audience, thanks to allah, that the saudi economy has witnessed considerable economic and social development since the turn of the century. this has largely resulted from the restructuring of the economy and improvement in the regulatory apparatus that has greatly facilitated domestic and foreign investment and thereby has helped enhance the efficiency and competitiveness of the economy. the non - oil real gdp has grown by an annual average of 4. 4 percent in the past five years. the private sector production went up by 4. 5 percent and its contribution to real gdp increased to 48. 8 percent in 2010 from 45. 5 percent in 2006. other key developments that took place during the last five years included : yearly state expenditure rising up to rls 2. 6 trillion ; decline in public debt to rls 167 billion ( 10. 2 percent of gdp ) ; annual current account surplus averaging $ 75 billion and increase of more than rls 550 billion in bank assets. according to the world bank group report, the kingdom has been ranked eleventh in the world and first in the east region in terms of doing business and provision of competitive environment in 2010. the development witnessed by the kingdom during previous years has been comprehensive and broad - based. vast number of development projects to modernize infrastructure, and improve facilities to provide water, electricity, health and educational services have been approved. therefore, it is expected that strong growth of the saudi economy will continue unabated and this will expand the financial sector in general and the insurance sector in particular. dear audience, insurance companies play a key role for the development and stability of public and private sectors by providing opportunities to individuals and firms to improve their risk profiles and obtain compensation for losses incurred. it is for this reason that sama has been keen in regulating the insurance sector in accordance with the national and international standards and practices.