First, it was expected that by September 30, 1997, banks would have completed a thorough inventory of all of their mission critical applications and established a comprehensive plan and priorities for their renovation. This benchmark has passed and so the banking agencies are now increasing supervisory efforts at those few banks that have not completed such an inventory and plan.
The risk of a ‘restrictive expansion’ must not be underestimated; the expansionary effects of a budget can be more than offset by the restrictive ones of higher financing costs for the State and the economy.