There are those who sometimes give the impression that they think the Euro could - by regulation or restrictions - be confined to within the territory of the Euro area, and that this would be “a good thing”. That I have to say is not our experience. In practice unnecessary or ineffective domestic regulations or restrictions have often been the cause of financial activity growing up elsewhere. In any event we live in a global financial world and the Euro is bound to become a widely-used and actively-traded currency internationally. Its liquidity is likely to be a key attraction to domestic and foreign users alike. The City of London both contributes to, and thrives upon, liquid markets, and the Euro-market, or the euro-Euro-market if we are an “out”, will be no exception. That can only be good for the development of financial activity - the provision of competitive financial services - across Europe as a whole, because we are not talking here about a zero-sum game. Euro-activity in London is likely to stimulate financial activity in other centres and vice versa; and much of that activity will be undertaken by branches or affiliates of the same major financial firms. The first ecu-Euro bond raised last week by a European borrower and managed from London by a Swiss/British and a French bank and by another French bank in Paris, is a good example not just of London’s international role as it is today, but of how it is likely to continue.
In November of 2013, the Bank outlined proposed regulatory reforms for the financial advisory industry which formed part of the “Life Insurance and Family Takaful Framework” or in short the LIFE Framework, which we published for consultation. An important aim of the reforms is to support the Bank’s desire to further diversify insurance delivery channels as one – although not the only – way to improve the quality of advice, and enhance choice and value for consumers based on their specific needs and circumstances. This in turn would contribute towards increasing the insurance and takaful penetration rate to 75 percent by 2020 as targeted under the Government’s Economic Transformation Programme (ETP). We received positive feedback from the financial advisory industry on the proposed reforms and while specific elements of the LIFE Framework remain under review to take into account the comments that were received, we have moved ahead to implement several changes proposed which concern the financial advisory industry. The Bank has lowered the minimum capital requirement for financial advisers to RM50,000 which will take effect from 1 January 2015 to encourage more advisers to enter the industry. This follows an increased focus on professionalism, innovation and quality of advice as the hallmark of those who are admitted to the industry.