profits ” in the banker, bahrain ’ s banking industry has turned in record earnings of us $ 3. 3 billion for 2007 and revenue momentum is expected to remain strong for the foreseeable future. unlike in the west, economies in this region have ample liquidity at hand so we are not as likely to suffer from credit worries. however, despite all the good news, the cbb is not taking a rest from its regulatory and supervisory role. we continue to take a proactive approach in developing new regulations or updating / revising existing ones, as appropriate, in line with our long - standing policy of implementing international standards. a key recent highlight has been the implementation, from the start of this year, of the basel ii regulatory framework, which will significantly enhance the risk management practices of bahrain ’ s banks. and, given the importance of islamic banking in bahrain, the cbb has become the first financial services regulator to adopt a comprehensive basel ii compliant framework which provides for appropriate capital treatment of islamic financial products. the cbb is also currently developing new rules to limit banks ’ exposure to the real estate market. although regulators cannot possibly micro manage the investment portfolios of their licensees, we do have a role to play in encouraging financial institutions to maintain more balanced portfolios. i would like to take this opportunity to stress that the cbb has an established policy of consulting with industry prior to implementing new or any upgrades to existing regulations. the cbb strives to be an even - handed, transparent regulator and we are open to suggestions from the industry. maintaining a regulatory environment that is, at once, business - friendly and adheres to international best practice is, undoubtedly, one of the success factors in bahrain ’ s development as an international financial centre of repute over the past 35 years. today, bahrain hosts the middle east region ’ s largest critical mass of financial institutions, which represent a good mix of international, regional and local players offering a very wide variety of services. within the financial services industry, the cbb sees significant growth in islamic finance, both banking and insurance, as well as private banking and the funds industry. in each case, the cbb has moved quickly to provide an enabling regulatory environment for the sound and stable development of that segment of the industry. ladies & gentlemen, i have no doubt that bahrain, as the middle east ’ s most mature financial centre, will remain at the forefront of financial developments in the middle east region. our core model remains strong and

remuneration for management and directors should be transparent and not excessive. management structure must be clear, and management must be held accountable to shareholders and the board for their actions and performance. above all, the company must be transparent in its communications with its shareholders and stakeholders. this would include in particular the prompt reporting of full financial and risk information and the disclosure of the governance structure and governance performance of the company. i would therefore encourage companies, their boards and their management to take the new code seriously and adopt it wholeheartedly if they wish to attract new investment and to retain the confidence of existing investors and other stakeholders in a post – subprime world. thank you.