At a time when many new financial products are being developed, boundaries between different sectors are being eroded, and financial conglomerates are emerging, while the financial markets are globalising, it is remarkable to note the strength of the traditional mortgage-credit product.
The goal of this supervisory assessment was to ensure that the equity capital held by these firms was sufficient – in both quantity and quality – to allow those institutions to withstand a worse-thanexpected macroeconomic environment over the subsequent two years and yet remain healthy and capable of lending to creditworthy borrowers.