system of european banking supervision. we have joined forces to make the banking sector safe and sound. in my view, this was the right thing to do. over the past decades, the financial system has turned into a global village. as a result, a crisis, say, affecting a single bank can quickly spread around the entire globe – as happened in 2008. this is particularly true for monetary unions such as the euro area. here, problems can spread even faster and may threaten the financial stability of the entire union. therefore, european banking supervision brings real benefits. it allows us to look beyond national borders and national interests. when we supervise banks and take decisions, we take a truly european view. at the same time, we can compare banks across the euro area and gain many more insights than national supervisors could. we can draw on a huge pool of expertise as our analyses are based on the knowledge and experience not only from the ecb but from across europe and beyond. all in all, the ecb itself brings together staff from 28 different countries. so not only do we have lots of data and information but we also have the resources to analyse it. all this helps to spot potential problems early on and thoroughly assess their impact. we can combine the best approaches to banking supervision from 19 different countries. we can ensure that high standards are uniformly applied in the entire euro area. this creates a stable and predictable business environment for banks that operate across borders. wherever they go in the euro area, they are supervised to the same standards and methods. the idea of harmonisation goes beyond supervision ; it is the theme of the entire european banking union. in january 2016, a european resolution mechanism for banks was introduced. it ensures that banks across the euro area can be resolved according to the same rules. a european deposit guarantee has not yet been agreed upon – but even without one we have made good progress. altogether, the banking union helps to create a level playing field for banks. this is the ground on which a truly european banking sector can emerge. and contrary to what 2 / 6 bis central bankers'speeches some people say, a large common market is better than isolated national ones. a common market creates more jobs, more income and more wealth. on that note, let us move to the second part of my speech. growing apart – brexit and the banks it seems that by now we have got used to political events that defy all expectations. last june, however, it was still a

muhammad bin ibrahim : financial services industry – opportunities and challenges for asia and europe speech by mr muhammad bin ibrahim, deputy governor of the central bank of malaysia, at the 12th asia - europe business forum : “ the potential role of islamic finance in contributing to global financial stability ”, brussels, 4 october 2010. * * * i am honoured to be invited to speak at this asia - europe business forum themed “ financial services industry : opportunities and challenges for asia and europe ”. during a time of global economic challenge and uncertainty, following the recent unprecedented global financial and economic crisis, it is timely for this forum to take place as a platform for business leaders and policymakers across asia and europe to reflect on the challenges and to discuss on solutions that can contribute to restoration of global financial stability. my address has a specific focus on islamic finance since over the last ten years it has grown phenomenally and it will play an important role in promoting greater global financial stability. in the current search for an enduring solution to ensure stability of financial systems, islamic finance offers tremendous potential in shaping more resilient financial systems that enables financial intermediaries to function efficiently within national economies and across borders. the much talk about discussions that banking should return to its fundamental functions of providing financial services which add value to the real economy, represents the very principle of islamic finance that explains its relative resilience during the crisis. effects of the 2008 / 09 global financial crisis and asia ’ s response the recent crisis had the global financial system badly shaken with widespread effects of an unprecedented scale across the world. the asian region has however demonstrated remarkable resilience during the crisis as most countries in asia entered the crisis period with a sound set of economic and financial fundamentals, mainly attributed to the lessons learned from the asian financial crisis of the late 1990s. it was painful. it was a bitter lesson. we embarked on a bold reform that fundamentally alters the landscape of our financial system. but the payouts have been tremendous. the governments of the asian economies have now the flexibility to implement large stimulus, given the strong economy and low public debt levels in the region. credit flows to the private sector remain undisrupted as financial institutions in the asian countries were strong and well capitalised. the household and corporate sectors in asia were also not over leveraged. furthermore, asia was not confronted by widespread unemployment. the various reform measures had enabled the asian economies to build more shock absorbers and reduced the number of shock amplifiers in their economies following the