Many other central banks have since followed the Bank of England’s lead, and in the HKMA we have published our own Monetary and Financial Stability Report for several years now. More recently we began an internal Banking Stability Report which aims to provide a macro prudential perspective on trends in the banking system that we can then use to target our on-site bank examinations more effectively. The eventual goal is to try to draw these two reports more closely together and to bring a more forward-looking perspective to our banking supervision work. When central banks make their financial stability analysis public it provides financial system participants with an insight into the central bank’s perception of the vulnerabilities of the system. It enables policymakers to be transparent in their views of where they perceive the risks and vulnerabilities to be. Hopefully, by raising warning flags at a sufficiently early stage – for example if we  BIS Review 106/2006  3  perceive risks in a build up of credit to a particular sector – we can encourage banks to review the risks that they are running and, if necessary, to take action to mitigate those risks. But it is important to be careful how the risks and vulnerabilities are presented. The last thing we want to happen is for the predicted problems to surface because everyone has rushed for the exit at the same time.
It is particularly important that the standards are unambiguous about the values for the industry and its workforce. It would facilitate financial services practitioners to understand and embrace their professional obligations, and be held accountable for their own continuing professional development. Bank Negara Malaysia and the Securities Commission Malaysia believe that with its stature and global complexion, the FSPB is well positioned to lead efforts aimed at raising the bar of  BIS central bankers’ speeches  1  professional and ethical standards including continuous professional development for across the financial services industry, thereby strengthening confidence in the industry and affirming the industry’s commitment to better serve public interest. Its membership of eminent experts and financial practitioners from the United Kingdom, Europe, Australia and Asia provides a valuable global perspective that will enhance the relevance of the standards developed by the FSPB and their universal application. The establishment of FSPB also reflects the advancement and progress of the financial services industry in Malaysia and the vision of its members to embrace and promote globally acceptable and applicable standards of professionalism, human capital development and ethical behaviour that will provide the much needed clarity to the public and the industry on what is expected of financial services practitioners. Indeed, in moving forward, the emphasis on the development of human capital which includes elevating professionalism and ethical behaviour of financial services professionals is paramount. Today, professionalism, ethics and the quality of human capital have become key drivers and enablers of change in the financial services industry.