Do you think your depositors are going to have the same confidence in you, even if it is somebody else that has failed? Do you think they are going to say, “it’s okay. Only one finance company has failed. The company that we have deposited our money in is okay. Therefore, we can go on without any problem”. Do you remember the finance company crisis in the late 1980s and early 1990s? When one finance company failed, what happened? Why is it that Northern Rock had to be supported so strongly by the Bank of England, even though it is not a clearing bank? Isn’t it simply because the Bank of England realized that if one major bank fails, the domino effect, or the contagion effect will take place? So, my dear friends, it must be now clear to you, that as directors, you are not only responsible to your shareholders; you are not only responsible to your own depositors; you are also indirectly responsible to all depositors. Don't forget that if one fails, the resulting effect on the industry and the markets is going to be very very serious. Nobody is going to be spared. That's why we want you all to understand your responsibilities. That's why we take the necessary steps to regulate the industry so diligently. We have a responsibility, to preserve the financial system stability of this country. We take that responsibility seriously.
While the issues would not be exhaustion but I will attempt to give a different dimension on the matters raised. Development of Islamic finance Islamic finance is now the fastest growing segment in the global financial industry. Notwithstanding the global financial crisis, Islamic finance has shown strong growth. The size of assets under management may very well exceeded USD1 trillion. Islamic finance has maintained an average growth rate of 15–20% per annum. New areas of business continue to show encouraging progress. Islamic Mutual Funds is growing at average of 23% per annum. The Takaful industry is growing at 13% per annum. Islamic finance has attracted a lot of attention. It is no more peripheral to the conventional banking system but has grown from being a novelty to be a viable and attractive alternative to the conventional banking system. Giant banking and insurance groups are now very much interested in Islamic finance as a way to growth their business. Five years from now, the data that I am showing you could very well change in terms of numbers and structures. Interest in Islamic finance is no longer limited to Muslim nations and Muslim communities. The world realizes the economic clout of 1.5 billion people is a market that cannot be ignored. The Islamic finance market offers an enormous potential for future growth. Long established financial centers such as London, Hong Kong, Tokyo and Singapore have already begun the first steps to enhance their respective centers into vibrant Islamic financial centers.