appropriately managed. i am sure that the mpc will play a useful role in helping the industry meet this challenge, by providing training for new practitioners and continuing its work on product development. the recent study on the feasibility and desirability of introducing overnight index swaps in hong kong is one good example of this work. 7. i should perhaps stop here to avoid encroaching further on the valuable time set aside for our guest speaker today. donald mathieson of the imf is no stranger to hong kong. many of you will be familiar with the authoritative reports and analysis of financial markets that he and his colleagues produce. we are fortunate in having been able to grab him for a couple of hours today while he is briefly passing through hong kong. it is my pleasure to welcome him and to join with you all in the launch of this seminar, which will, i hope, be the first of many organised by the mpc over the coming months and years. 8. finally, let me record my gratitude and congratulations to all the committee members of the mpc for the excellent work they have put into the reconstruction of the committee, and my thanks to everyone here for supporting this event today.

prospects remain good. in fund management, global mandates are now increasingly being managed out of singapore. the industry is also expanding in breadth and depth. beyond marketing and portfolio management, fund management firms are also locating regional functions such as trading, risk management and research in singapore. more hedge funds are also setting up here, adding to the industry ’ s diversity. private banking should continue its sterling performance, as asia - pacific is the fastest growing region for private banking in the world. according to merrill lynch, asia - pacific high net - worth individual wealth jumped 11 % last year, supported by high savings rates and robust gdp growth in key regional economies such as china, south korea and australia. this figure could be an underestimate, given the low penetration of high net worth individuals in asia by private banks. bankers managing private wealth will be attracted to locations which enjoy political and social stability and possess wellrespected regulatory, legal and accounting systems. singapore has all these attributes and is well placed to become a premier centre for private banking business in asia. reputable and well regulated regimes like singapore can provide a location of choice for investors and financial intermediaries alike, especially with the renewed emphasis on corporate governance and integrity after the excesses of the dotcom era. we can exploit this advantage to become a regional risk mitigation centre, for instance in the areas of clearing & settling otc and exchange - traded products. the current outsourcing and off - shoring trend would also present opportunities for us. one estimate is that two million jobs would be created in lower - cost locations like india and china over the next 5 years. while we cannot compete with india and china on cost, we can compete for processing activities which are mission critical and of higher value - added. in the past year, major financial institutions have relocated higher - end middle and back - office operations here. these institutions take the view that singapore ’ s developed infrastructure, reliability, and skilled manpower make us more suitable for these time - sensitive and mission - critical functions. in the banking sector, we have gone from 7 local banks to 3 over the last 5 years. singapore banks have grown larger and stronger, and they are continuing to build up their regional footprints. as a regulator, mas is happy that they have made progress strengthening management teams and building up risk management systems. last year, one rating agency even ranked singapore banks as being among the strongest not only in asia but in the whole world. 5 however, by international