sophistication of the investor base, the asset securitization market in singapore has also taken off. for 2006, abs issuance amounted to more than s $ 19 billion. there is also an influx of more structured products into our market such as convertibles and synthetic collateralized debt obligations. turning to wealth management, assets under management ( aum ) has continued to grow strongly. 2005 was the fifth consecutive year of double - digit growth for singapore, with aum increasing 26 %. this trend has continued in 2006, evidenced by the expanding wealth management community in singapore. this underscores singapore ’ s emergence as a wealth management center. singapore is strategically placed to capitalize on the significant wealth building up in asia. at the same time, increasing interest from international investors to diversify a greater proportion of their portfolios to asian assets has created business opportunities for fund managers based in asia, including singapore. the local banks too registered good financial performance last year. altogether, their profit grew by over 40 %. their return on equity also improved by 2 - 3 % points compared to the year before. at the same time, the local banks have also shown improved financial health. asset quality has improved further. classified loans represented 1. 6 % of total loans in 2006 compared to 2. 2 % in 2005. the local banks remain well capitalized, meeting mas ’ regulatory requirements and in comparison with peer banks internationally. taken together, these developments bode well for singapore ’ s efforts to develop itself as an international financial center. barring any unforeseen shocks, 2007 looks to be another good year for the financial services sector. navigating the risks ahead that said i would be remiss if i did not point out some of the risks on the horizon. for now, the global environment appears benign with rosy prospects for growth worldwide. nevertheless, various uncertainties could quickly unsettle this. for one, it is unclear how the mounting global imbalances between the east asian countries and the developed countries will resolve. a sharp and abrupt adjustment would affect the global economy. it also remains unclear how long the golden era of good growth coupled with low inflation will continue. already, fears of inflation have resurfaced. to complicate matters, we must not forget the geopolitical risks in the middle east, terrorism and other surprises. this year, we have already had several reminders of the risks in the system. the chinese stock market has experienced a

delisle worrell : general financial sector issues and policies opening remarks by dr delisle worrell, governor of the central bank of barbados, at the financial institutions conference “ general financial sector issues and policies ”, bridgetown, 3 november 2011. * * * this is our second annual conference for all financial institutions. we have a full day of discussion, which allows us to study current issues of the financial sector in depth. with the participation of all financial institutions, and with the collaboration of the financial services commission, we are able to take a comprehensive view of the financial system, including banks, finance companies, insurance, pensions, mutual funds, credit unions and securities. this conference deals with financial institutions that do domestic business ; in march this year we held a conference for financial institutions in our international financial centre, and that is also intended to be an annual event. since last year we have taken important steps to further strengthen financial oversight, and to increase the efficiency of the delivery of financial services. the most important of these was the establishment of the fsc, with responsibility for the supervision of non deposit takers. the fsc is in the process of recruiting staff and setting up systems, and central bank is lending its expertise wherever we can be helpful. this morning you will hear more about its activities from the fsc themselves. we have also been strengthening cooperation with banks which have domestic retail operations, through regular quarterly meetings, as well as ad hoc meetings when we need to make policy changes, such as the change in our foreign exchange margins. we are constantly strengthening cooperation with canadian and other overseas regulators, with the bank of canada and with the head offices of banks operating in barbados. we do consolidated supervision of all the operations of multinational banks, together with the regulators of all the countries in which these banks operate, through a variety of channels and mechanisms, including collective overview by the regulators and discussion with the banks in meetings which have come to be known as “ colleges ”. regulators also arrange conference calls and have informal contact, as well as more formal arrangements such as information - sharing memoranda of understanding. two weeks ago i led a team of my colleagues on a most successful visit to toronto and ottawa, where we had discussions with the major canadian banks, including those active in our international financial centre, with the office of supervisor of financial institutions ( osfi ), the bank of canada and the financial institutions supervisory committee, which also includes their deposit insurance corporation, their consumer protection agency and