Local currency bonds are gaining the attention of foreign investors both from the perspectives of diversification and return enhancements, coupled with the optimism of appreciating Asian currencies. On the other hand, Asian bond markets are also growing as an increasingly attractive asset class for domestic borrowers as they steer clear from the international market. This indicates that the economies are increasingly relying on domestic demand and intraregional credit investments. Infrastructure financing, for instance, is also regaining importance in a number of Asian economies. The key is to have sufficiently deep and efficient markets to effectively channel the high bank liquidity and abundance of savings in Asia into regional investments. With the robust outlook in Asia, this will continue to underpin the need for investment opportunities to fuel the growth engine. Singapore, right in the heart of Asia, is poised to play a significant role as a gateway for global investors to access the Asian bond markets. We are also poised to serve as the centre for debt financing in the area of infrastructure, real estate and transportation related projects. Project sponsors are increasingly tapping our debt capital market in financing major infrastructure related projects in Asia. Since we started developing the REIT market in 2002, there are now 19 REITs and 1 property business trust listed on the SGX with an aggregate market capitalization of approximately $ billion. Issuance of Commercial MortgageBacked Securities (CMBS) remained strong on the back of a healthy REIT market.
David Carse: The changing landscape of banking in Hong Kong Speech by Mr David Carse, Deputy Chief Executive of the Hong Kong Monetary Authority, to the Hong Kong Investment Funds Association, Furama Hotel, Hong Kong, 15 August 2001. *  *  *  Ladies and Gentlemen, Thank you for inviting me to speak to you at the Association's luncheon. My topic today is the changing landscape of banking in Hong Kong. I shall illustrate this by reference to two of the key recent events that are changing that landscape and are going to go on doing so in the years ahead. I am referring to the deregulation of interest rates, the final phase of which took place on 3 July of this year, and the introduction of the Mandatory Provident Fund scheme. I will try to describe the implications of these for the banking industry and for the regulators. I will also try to place them in the context of the broader trends and developments that are taking place in the banking industry. Current industry trends You are probably already familiar with some of these trends and developments. The most obvious one is the increasing intensity of competition. This is a global phenomenon, whose full effects have only recently hit Hong Kong. It has shown here up in the sharp decline in lending margins, particularly on residential mortgages.