An upstart can take on a giant ……….. and win! A new bank is like “the gentle rain from heaven upon the place beneath” – “it brings fresh showers to the thirsting flowers from the seas and the streams”. It is a refreshing breeze.
Thus, it is necessary to complement a strengthened microprudential regulation with a macroprudential stance which as a second line of defence takes into account the stability of the financial system as a whole. One major aspect of macroprudential regulation would be the treatment of systemically important financial institutions.