By the end of March 2008, the market capitalisation of banks globally had declined by USD720 billion. These developments prompted the former US Fed Chairperson, Mr Alan Greenspan, to remark that “the current financial crisis in the US is likely to be judged as the most wrenching since the end of the Second World War”.
Financial market asset prices have also echoed these extremely distressed circumstances and volatile conditions, in some instances requiring unconventional responses by central banks and other international institutions. Recent events again put into full perspective the crucial role of central banks in times of turmoil.