are identifying weaknesses in banks'risk management practices, including underwriting practices, appraisal processes, stress testing, and market analysis. based on these results, we are updating our supervisory plans and examination schedules to focus our resources most effectively on those institutions presenting the greatest risk and needing the most improvement. finally, we just concluded a federal reserve examiner training effort on cre topics, including appraisal practices, loan loss allowances, stress testing, and board and management oversight. the training focused on the importance of ensuring prudent risk management practices, without unduly curtailing credit availability. counterparty credit risk concerns in financial markets about the creditworthiness of some financial intermediaries have eased somewhat since the first half of march, but those concerns remain relatively high. more fundamentally, the proper management of counterparty credit risk – which is the risk of loss from a counterparty's failure to perform its financial obligations – is a prerequisite for protecting the entire system from contagion when any one institution fails. consistent with the recommendations of recent reports, we are looking at how firms are addressing weaknesses in counterparty credit risk management practices highlighted by recent events, including the measurement and aggregation of exposures stemming from a wide range of transactions with both unregulated and regulated entities. for instance, we are emphasizing that firms should use a variety of techniques to measure potential exposure on over - the - counter ( otc ) derivatives, repurchase agreements, and other contracts, and that they should aggregate all exposures to each counterparty. in this context, we have been closely monitoring counterparty exposures arising from transactions with monoline financial guarantors and have been discussing with banks the measurement and management of these positions. in addition, we are working to strengthen the market infrastructure for financial transactions to make it more robust and more resilient. in particular, the federal reserve bank of new york continues to work with domestic and international prudential supervisors of otc derivatives dealers to strengthen the infrastructure for those large and rapidly growing markets. the supervisors are emphasizing to the major dealers and to other active market participants the importance of setting standards for the accuracy and timeliness of trade data submission and for the timeliness of resolutions of errors in trade matching for otc derivatives contracts. furthermore, consistent with the recommendations made in recent reports on turbulence in financial markets, supervisors are encouraging the development by the industry of a longer - term plan for an integrated operational infrastructure supporting otc derivatives

. fourthly, is the uncertainty related to the implementation of the structural reforms to address the structural rigidities and deficiencies that surfaced during the global financial crisis. fifth and finally, are also considerable geopolitical uncertainties prevailing in the world today. cumulatively, these developments have compounded the uncertainties surrounding the global economy. in this environment of great uncertainty, a more moderate recovery of the global economy has been projected for 2015. the most pressing challenge, therefore for the global economy, is to generate an economic recovery that is balanced and sustainable. although the growth momentum has improved in a number of major economies, the growth has thus far been modest. in addition, weaknesses in several major economies continue to point to a global economy that remains vulnerable to downside risks. while the growth performance in most emerging economies is projected to moderate, collectively emerging market economies remain an important driver of growth of the world economy. a less robust external sector, bis central bankers ’ speeches slower domestic demand and specific domestic factors are amongst the reasons for this growth performance. in asia, the growth for 2015 is projected to be sustained at 6. 4 %, while growth in the asean - 5 is projected to be in the region of 5 %. a further phenomenon affecting the global economic performance is the significant decline in global oil prices. while this has partially offset the weaker - than - expected growth momentum in some of the advanced countries, it has, in different degrees, adversely affected the oil exporting economies resulting in divergent growth performance across and within regions. overall, however, the global economy is expected to benefit from the lower oil prices. a further recent development is the consequences of the unprecedented and divergent monetary policies being pursued in the major economies which have now resulted in significant policy spillovers to other parts of the world. against this backdrop, the financial markets are therefore expected to remain in a state of heightened volatility during this year. given the degree of openness of the malaysian economy and the financial system, we are of course affected by these global developments. these effects, however, need to be seen from the perspective of our underlying conditions. malaysia is affected by these external developments through trade and capital flows. the diversified structure of our economy and of our exports has reduced the impact of the effects of the plummeting oil prices on the economy. while the current account of the balance of payments is expected to narrow, it is projected to remain in surplus. the global shifts in liquidity have caused size