Published Date: 10 November 2008

Opening Remarks by Mr Ong Chong Tee, Deputy Managing Director, Monetary Authority of Singapore, and Council Member, Institute of Banking and Finance

Sir Howard Davies
CEOs of our member institutions
Financial Industry Certified Professionals (FICPs)
Distinguished Guests
Ladies and Gentlemen

I would like to welcome all of you to the IBF’s Distinguished Speaker series, which aims to bring together prominent leaders in the world of banking and finance to share with us their insights and learning. Through this and other platforms, IBF hopes to foster dialogues among leaders and professionals in our industry on strategic issues that are important.  Allow me to make some brief remarks as a prelude to our esteemed speaker Sir Howard Davies.


2   The topic that we will be touching on is both timely and relevant. What started a little more than a year ago as the US sub-prime mortgage crisis has evolved into a worldwide financial crisis that has triggered unprecedented stabilisation measures by governments in both developed and developing countries. The impact of this crisis is still unfolding but its effect has already been felt in global economies.   

3   The fears of rising inflationary pressure just a few months ago have given way to concerns over the magnitude and duration of the slowdown in economic growth. As a small and open economy, Singapore cannot be insulated from the global credit crunch and, like most economies, growth prospects have shifted lower.

4   The turmoil in the global financial markets will continue to impact global economic activity through several channels. First, wealth destruction following the collapse of stock markets worldwide and falling home prices, particularly in the US, is likely to curtail household and corporate spending. Second, credit markets remain tight. Until troubled assets in the banking sector are shed and capital have been rebuilt, financial institutions are likely to remain risk averse. This will continue to constrain access to credit by households and corporates. Third, the slowdown in the economy is likely to lead to further weakness in the labour market. The associated cutbacks in employment and wages can depress private sector spendingThere is the a risk that slower growth will in turn, feed into more bad loans and wealth destruction, creating a vicious spiral.


5   While national authorities work to mitigate this downward spiral, it is also important for us to step back and consider how we can strengthen the global financial system to prevent a repeat of this episode.  A sledge-hammer approach is to completely tighten regulations across the board, and roll back all the de-regulatory efforts of the past decades.  However, this approach is akin to throwing out the baby with the bath-water.  The  economic costs will be considerable.  A more calibrated or nuanced approach will focus on preserving the positives of an open market system, while ridding it of the excesses of the last few years.  This crisis highlights the close economic linkages and interdependence between countries and the importance of international cooperation in addressing these issues. Although Singapore’s financial system remains stable and robust and financial institutions are well capitalized and operating normally, it is without doubt that there are many lessons that we too can learn from the current crisis on regulatory and risk management practices.

6   It is with this backdrop that it gives me great pleasure to introduce Sir Howard Davies, who has a wealth of experience as a regulator and central banker.  I am delighted that Sir Howard has graciously accepted IBF’s invitation to share his perspectives on this crisis.

7   Sir Howard is no stranger to many of us.  He is currently Director of the London School of Economics and Political Science, and has a long and illustrious career which includes his stints as Chairman of the UK Financial Services Authority, Deputy Governor of the Bank of England, Director General of the Confederation of British Industry and Controller of the Audit Commission, just to name a few.  


8   Just before I hand over to Sir Howard, I would also like to acknowledge the ten senior leaders in our industry that will be receiving certification as Financial Industry Certified Professionals (FICPs) today, under the Financial Industry Competency Standards (or FICS).  I am delighted that notwithstanding these challenging market conditions, these individuals took time to continue to be certified.  As you may be aware, FICS provides a comprehensive set of competency standards for the financial industry, incorporating a structured framework for the development of our financial workforce. FICS has been developed by the industry and serves as a platform to further nurture and develop leadership competencies.   

9   As the old Chinese saying goes: 时势造英雄, or heroes and leaders are made over turbulent times. The conferment of the FICP title exemplifies a commitment to life-long learning, to reach the top of the profession. I congratulate our Financial Industry Certified Professionals who serve as role models for other aspiring finance professionals.

10   On this note, may I now invite Sir Howard to deliver his speech.