It is important for us that a déjà-vu experience is avoided. You may recall that the United States was involved in the Basel II negotiations, but did not fully implement the reforms – even though the “America first” doctrine had yet to be coined ...
If competitive pressures were to erode the spread for specific instruments to BIS Review 17/1998  -3-  the point where no creditor is being fully compensated for the risks involved, prudent banks should consider whether they want to be involved in that particular business in the first place.