There has also been significant shifts in the asset portfolio composition. Following the initiatives to promote SME access to financing, banking sector loans to this sector have increased significantly to account for 38% of total business loans. Retail lending for consumption has also increased. The strong banking system has been well positioned to meet customer demand for financial services. Indeed, the banking industry has continued to benefit from strong demand for household credit. •  The enhancement to the legal infrastructure including enactment of the Payment Systems Act 2003 will serve to strengthen Bank Negara Malaysia’s payment system oversight, and to provide the legal framework to ensure that payment systems are protected from disruptions and its consequent effects on financial stability. •  The Islamic financial system has evolved to form a vital component of the Malaysian financial system. The Islamic banking system now accounts for almost 10% of the total assets of the banking system, from 6.9% in 2000. Significant milestones have been achieved in developing the Islamic financial infrastructure as well as in the development of the prudential regulatory and supervisory framework in meeting the changing requirements of the new economy. 2  BIS Review 28/2004  •  Following the intensified consumer awareness and literacy programme that has been implemented, there is evidence of growing consumer involvement in product development and delivery. Customers are demanding greater service quality and product offerings to fulfil their preferences and requirements.
3/8  fact, Norway has scored particularly favourably in recent years by managing to sustain productivity8 growth at a strong level. We seem to have avoided this symptom of Dutch disease. Restructuring in the Norwegian economy in the 1990s, changes in the tax system, broader and deeper financial markets, deregulation in trade and service markets and the use of the market mechanism in the telecommunications, postal and transport sectors appear to have contributed to a more efficient use of resources. This is a fourth positive result. Another wealth effect could be lower labour force participation and higher welfare spending. In Norway, labour force participation is relatively high after lagging behind our neighbouring countries up to the 1990s. The labour force participation rate has declined somewhat in recent years, but is still at a high level. This is a fifth positive result. However, the average number of person-hours worked is lower than for the other Nordic countries, and this difference seems to have increased through the 1990s to date. The increase in the labour force participation rate during the period does not seem to be the explanation. Reducing working hours is one way of spending income and wealth gains. We could also spend wealth gains by reducing the retirement age. OECD figures show that the difference between the official and effective retirement age is wider in Norway than in other comparable countries. Developments in expected retirement age are a cause for some concern. A working 40-year-old can now expect to retire at around 63.