The risk management role of helping identify, evaluate, monitor, manage and control or mitigate these risks has become a crucial role in modern-day banking. Indeed, it is probably not exaggerating the importance of this to say that the quality of a bank's risk management has become one of the key determinants of a success of a bank. Basel II recognises the importance of these risks - and of the quality of risk management - by means of what is known as "Pillar 2". Under Pillar 2, there is an assessment firstly of all the risks a bank is running and, secondly, of its ability to manage these risks. This can lead to the bank being required to hold more capital to cover these risks, or to make improvements in its risk management. Pillar 2 therefore encourages banks to improve risk management, and gives capital incentives to do so. 1/5  I will say some more about this later on, but it is probably time at this point that I said a little about how Hong Kong is implementing Basel II. Hong Kong implementation We took a strategic decision early on in the Basel II process that Hong Kong should implement Basel II in accordance with the timetable recommended by the Basel Committee of Banking Supervision for its own members. This means adoption of most of the approaches under the new framework from the start of 2007, and the more advanced approaches from the start of 2008.
To increase the chance that project developers can attract private funding, they need to enhance their communication with investors by understanding their risk concerns and speaking in their risk language. This is how we can make projects more bankable. On this front, IFFO has developed a reference term sheet for infrastructure investments in Emerging Markets together with key institutional investors last March. To further facilitate the use of this common language, IFFO has also rolled out a number of capacity building initiatives the past year for all partners. Fintech Apart from infrastructure financing, fintech counts as another most frequently discussed topics in industry events and international conferences in the past year. But like infrastructure financing, we are not just talking about it, we are also doing something about it. HKMA announced September this year a series of measures to facilitate the financial services industry to grasp the opportunities in fintech, covering financial infrastructure, regulatory sandbox, research and talent development, etc. I will leave this to my colleague, Shu-pui, to share more with you in the panel on fintech later this afternoon. But I wish to highlight one point, and that is, fintech is borderless. It requires collaboration among financial centres like Hong Kong and London. A fintech solution that works only in a particular jurisdiction is of little value to clients and financial institutions that are often located half-way across the globe.