In fact, adding up the net specific provisions made for loan losses since the beginning of 2008, the general provisions also used to cover impaired assets, and the charges to reserves by savings banks involved in the aforementioned restructuring processes, write-downs in the last three years by the Spanish banking system amount to about € billion, or around 9.5% of GDP. Moreover, in that same period, thanks to FROB resources, but also, especially, to the efforts by banks, the latter have increased the capital held in excess of minimum requirements by approximately € billion, or roughly 5% of GDP. A key factor in the sector restructuring strategy has been the decision to increase the transparency of the Spanish banking system as much as possible. Whenever the general perception is more negative than the reality, the best policy is to present all the data clearly. For that reason the Banco de España announced last June that it would conduct stress tests,  BIS central bankers’ speeches  3  which it was later agreed should be carried out at the European level under the coordination of the CEBS. Although these tests were severely criticised after the collapse of some banks in other countries which had successfully passed them a few months earlier, the rigour and transparency of the exercise carried out by the Spanish supervisor must be emphasised. Demanding criteria were used and, unlike in other countries, all listed banks and savings banks were tested and much more detailed information on their portfolios was offered.
The Malaysia International Islamic Financial Centre, or MIFC, initiative, launched in August 2006, has taken Malaysia's liberalisation strategies to a new level with the aim of positioning Malaysia strategically in this new growth area. Islamic banking institutions are allowed to undertake a broader array of Islamic financial activities that include commercial banking, consumer banking, investment banking as well as international currency business under the MIFC initiative. Financial institutions need to consider their own competitive positioning in this area and to have the appropriate strategies to participate in this dynamic growth sector. Finally, the regulatory and supervisory paradigm will also continue to evolve. Indeed, we have over the recent decade witnessed significant global shifts in the approaches to regulation and supervision across many countries. These have ranged from radical policy responses in some countries that led to the introduction of costly regulatory systems to address the problems have emerged, to bold deregulatory measures pursued in other countries, especially during times of exuberance and strong market conditions. A convergence towards the middle ground between these two extremes now seems to be emerging. Two dimensions of regulatory change will be relevant to the context of the new environment. First, the emphasis on creating a strong risk management culture that is fundamental to sound banking operations will become significantly more pronounced. T he transition to Basel II and the implementation of the risk-based supervisory regime are important elements of this change.