total banking system while the takaful sector has increased its penetration rate to 14. 6 % of the population. this is indeed very good progress. in the sukuk segment, malaysia is also the market leader with market share of more than 50 % in sukuk outstanding since year 2000. on the bank ’ s part, the islamic financial services act 2013 was introduced to modernise our regulatory and legal framework in adapting to changing needs of the industry. the issuances of 12 shariah standards set clear shariah parameters to facilitate innovation beyond credit - based products. there are more than 100 competitive financial products ─ ranging from basic financial services to wealth management ; corporate finance ; and investment banking. meanwhile, investment accounts have spurred greater investment intermediation activities. since its inception two years ago, investment accounts have grown to account for 12 % of total islamic deposits and investment accounts in 2016. its offering has been further intensified through the operationalisation of the investment account platform which has the potential to mobilise capital to various productive ventures effectively. the development of the islamic finance sector is seen not only in the headline numbers, but more importantly in addressing social and environmental concerns. islamic finance has taken the lead in the space of ethical finance where concepts, such as sustainable, responsible, impact investing ( sri ), have been embraced in pursuit of values beyond financial motivation. an important pioneering example in the islamic capital market is the issuance of sri sukuk by 1 / 4 bis central bankers'speeches khazanah that brings greater social impact through the promotion of quality education. just last month, the first green sukuk has also been issued in the country to promote clean and sustainable power supply. while we have come a long way, now we need to think of ‘ what ’ s next ’? from the bank ’ s perspective, we believe that the way forward to propel the islamic finance industry to the next level of growth ─ if i may, a ‘ game changer ’ ─ should give equal weight to both economic value creation and upholding ethical values. that is why we have embarked on vbi, which is a holistic approach for our industry players to deliver the intended outcomes of shariah that generate positive and sustainable impact to the economy, community and environment. while vbi shares similarities with concepts such as ethical finance, esg ( environmental, social and corporate governance ) and sri, the distinguishing factor is the central position of shariah in determining islamic finance

investors after a set of tax changes, and subdued credit demand from new buyers as incomes have been squeezed, has masked the effect of looser credit supply to owner occupiers. mortgage rates have fallen materially relative to bank rate, especially at the riskier end of the lending spectrum ( see chart 2 ). and lenders are now prepared to take a bit more risk. mortgage loan to income ratios are rising. households with high mortgage debt make cutbacks in downturns to keep paying the mortgage. more of these households in an economy typically means deeper recessions ( see chart 3 ). that ’ s why, when it comes to mortgages, the interests of the real economy can be served by guarding against excessive risk taking by lenders. we put in such guards, as insurance, back in 2014. they ’ re centred on a limit on new mortgage lending at more than 4. 5 times the borrower ’ s income and on testing of the affordability of a mortgage to a borrower even if mortgage rates were in the region of 7 %. with lenders now prepared to take more risks, those guards are now working. loan - to - income ratios have increased and are now hitting up against them. the proportion of new owner occupier mortgage loans at loan - to - income ratios just below 4. 5 has almost doubled in the past 5 years. almost a fifth of new mortgages now fall into this bucket ( see chart 4 ). in part because of our guards, households ’ mortgage debt servicing burdens remain very low. only 1. 4 % of households spend 40 % or more of their income servicing their mortgage debts. and even if interest rates were to be at 2 %, that share - at 1. 9 % - would be no more than it has been on average in the past. for example, bunn and rostom ( 2015 ) find evidence that more highly indebted groups of households made larger cuts in spending following the financial crisis. see www. bankofengland. co. uk / working - paper / 2015 / household - debt - and - spending - in - the - uk a loan to income limit, setting out that no more than 15 % of new mortgages can be issued at loan to income ratios of 4. 5 or higher ; and an affordability test, under which lenders consider whether new mortgagors could still afford their mortgage if they switched to the mortgage reversion rate and