7  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  7  Chart 1: Since 2010 we have seen a significant fall in mortgage spreads, particularly at higher LTVs Quoted 2-year 75% LTV spreads over risk-free rate  Quoted 2-year 90% LTV spreads over risk-free rate Percentage points  Percentage points  7  7  6  6  5  5  4  4  Spread  Spread  Risk-free rate  Risk-free rate  3  2y 75% LTV  3  2  2  1  1  0  0  2y 90% LTV  Source: Bank of England, MoneyFacts Notes: Risk-free rate is defined as 2 year overnight indexed swap (OIS)  Chart 2: We have observed a marked shift in the share of new mortgages at high LTV by building societies Major UK Lenders: share of new mortgages at high LTV  Building Societies: share of new mortgages at high LTV  35%  35%  30%  30%  25%  25%  20%  20% 85 ≤ LTV < 90  85 ≤ LTV < 90  90 ≤ LTV < 95 15%  LTV ≥ 95  90 ≤ LTV < 95 15%  10%  10%  5%  5%  0%  LTV ≥ 95  0% 2015  2016  2017  2018  2015  2016  2017  2018  Source: FCA Product Sales Database Notes: ‘Major UK Lenders’ include the large UK Banks and Nationwide.
There is also the opportunity to list the sukuk on Bursa Malaysia, the Malaysian bourse, which has emerged as the largest exchange for sukuk listing in the world. This gives the listed sukuks greater profiling, visibility and transparency in the global bond market. Collaboration in issuance of sukuk would indeed benefit Turkey, as Turkey’s aggressive diversification of its industrial base and services sectors will require huge financing needs that could be partially met through the Islamic financial markets. Large infrastructure projects such as building the Bosphorus shipping canal, the new railway lines and highways might require funding via issuing sovereign sukuk as an alternative source of funding. The extensive privatisation in basic industry –transportation, communication and banking – would also offer the corporates and alternative source of financing that is competitive and innovative. Secondly, in promoting cross-border financial activities, the Turkish financial community could network with Malaysian-based investors, and practitioners to facilitate more business opportunities. Malaysia has diverse domestic and international players that engage in international currency business. There are now 150 entities in Malaysia’s Islamic financial system which offer a wide spectrum of Islamic products and services. There are also more than 150 funds in Malaysia including real estate investment funds (REITs) and ETFs that practise ethical investments. These entities have the capabilities to structure funds for investment abroad, including into the emerging markets. Additionally, there are opportunities for ethical investments as more than 80% of equities listed on the Malaysian stock exchange are shariah compliant.