Containing systemic risk in the financial sector continues to be a significant concern among regulators globally. We are committed to maintaining financial system stability.

Our policies and processes aim to ensure compliance with both letter and spirit of laws and regulations in the countries we operate in. We inculcate a strong compliance culture, and our employees are required to attend regular training sessions to refresh and update their knowledge of compliance requirements. The principles of our compliance framework are outlined in the Corporate Governance report. We believe this approach supports our application for licences in markets, and for products and services. During the year, we were among the first two foreign banks to be given a licence to set up a sub-branch in the Shanghai Free Trade Zone. We will continue to adhere closely to various regulatory requirements as they develop.

We work closely with regulators and industry associations to ensure safety for our customers and their personal data. In 2013, we embarked on a campaign to encourage customers to upgrade their magnetic stripe credit cards to chip cards for enhanced security and at the same time enjoy improved customer benefits. The upgrade is an example of how implementing improved security measures can be combined with an enhanced client experience.

We also work with regulators and the industry to combat the growing threat of cybercrime. In 2013, we demonstrated our monitoring capabilities to regulators and government bodies as we worked with them to address this threat.

We aim to be consistent with the principles and standards set out by the Financial Stability Board (FSB) in relevant areas, including our remuneration policy and risk disclosures. We have adopted standards for our risk disclosures in this annual report to be in line with the recommendations of the Enhanced Disclosure Task Force set up by the FSB.

Members of senior management continue to be active in regulatory and industry forums. We believe our insights from operating in the region can contribute to the formulation of financial standards and regulations, which can often have a global impact.