A sharp rise in yields may entail an increase in cost of variable-rate debt contracted by the corporates. This, to some extent, could be offset if there is a depreciation of the relevant currency and consequent decline in the value of the existing debt contracted by corporates in that currency.
The more the boundaries between sectors are blurred and the more intensively banks work with non-licensed enterprises, the more relevant discussions like this will become. My personal view is that we should discuss to what extent we might take a closer look at supervising individual activities – activity-based supervision – in addition to entity-based supervision.