will again register good profit as for the first half of 2006, the amount of profit generated was already rm800 million. the total assets of islamic banking currently stands at rm122 billion. the performance of the malaysian islamic financial market in particular the capital market has been encouraging. the islamic corporate bonds stands at rm121 billion, which constituted 55 percent of the total corporate bond market in malaysia. more recently, a total of 26 new corporate sukuk issues with an aggregate value of about rm23 billion were announced in the first half of 2006, representing 71 percent of the malaysian domestic market's rated corporate bond issues for that period. the operating environment of islamic finance in malaysia has also evolved dramatically. the product range has now expanded into broad array of innovative instruments using contracts beyond murabahah or bai bithaman ajil ( bba ). in past few years, several new islamic financial products were introduced which included residential mortgage backed securities, commodity based financing, as well as investment and equity linked product based on musyarakah, mudarabah and ijarah. recent issuance of khazanah's exchangeable sukuk is based on musyarakah contract. malaysia has strong potential to be the centre for sukuk origination as over 60 per cent ( usd32 billion ) of the outstanding sukuk issuance globally was originated from malaysia. we have also seen that multi - lateral agencies have begun to tap the malaysian market and our recent move to liberalise foreign currency denominated financial instruments to be issued out of malaysia provides a strong catalyst in facilitating the international sukuk market. i would like to urge the industry players to take this opportunity and establish strategic alliance and form syndicates to market these products particularly in view of the growing infrastructure and construction projects being undertaken in the middle east. government facilitative policies are also an important enabler to accelerate the growth and support the development of the industry. apart from establishing strong legal and shariah framework, the government has also laid down conducive tax legislative that accords tax neutrality treatment for islamic finance transaction. the recent initiative to position malaysia as an international islamic financial centre, will further spur the business environment thus contribute to create more conducive landscape. this initiative will bring in more players, enhance competition and encourage new diversified products and services, especially in international currencies. this rapid growth and positive performance achieved thus far signifies one of our major

accomplishments over the last two decades in islamic banking and finance. the robust growth of islamic finance industry today augments the collaborative efforts within the industry to move in tandem to strengthen the position of islamic finance in malaysia. as islamic banking and finance in malaysia journeys towards global integration and international acceptance, there are key areas in the banking industry that needs to be enhanced to progressively support future development moving forward. of importance, is the need to effectively engage other stakeholders through various means and approaches including promotional activities and strategies. it is imperative that the approaches adopted to be dynamic and innovative so as to ensure consistency and relevancy with the rapid development of the industry. the kliifex 2006 is well - positioned to be the platform to effectively engage with key stakeholders ; i. e. consumers, relevant agencies, scholars and intermediaries. communication and direct interface with these key stakeholders will advance towards effective dissemination of information to promote greater awareness and appreciation on islamic finance to create a more literate society on the virtues and benefits of islamic banking and finance. the organising of kliifex 2006 has some embedded key values and essence that need to be strengthened moving forward. the most significant is the strong alliance among the players within the industry as well as with the relevant institutions including educational, training and research institutions, knowledge centres and other professional bodies in promoting the development of the industry. islamic finance will achieve greater heights with the collaborative efforts of all relevant parties, especially those outside the industry. the existence of these networks and linkages is a catalyst towards strengthening the landscape for future innovations and advancements in islamic banking and finance at the domestic and international fronts. the second essence of kliifex 2006 is the involvement of international players, particularly with the participation of foreign exhibitors in this year's event. as the cross border trades and international islamic finance activities intensify, strong interlinkages among the domestic and international players are crucial. leveraging on the significant inroads and growing global recognition enjoyed by malaysian players, this event will accord opportunities for the players to understand each other's strength and capabilities that would lead to more strategic alliance in the area of islamic finance. this is certainly relevant in our effort to enhance the position of malaysia as an international islamic financial centre ( mifc ). the players should seize the opportunity to increase interactions towards finding the right partners and exploring strategies and that are able to capitalise on tax incentives and other operational flexibilities accorded under mifc to position malaysia as an