We might, for instance, require the banks to report, in detail, on the evolution of their NPLs; to collect different information; to re-evaluate the collateral taken in to cover the loans; or to apply specific adjustments, such as deductions and filters, to the calculation of own funds. Such actions are nothing new: they are part and parcel of a supervisor’s daily work.
7  See Allen M., C. Rosenberg, C. Keller, B. Setzer and N. Roubini (2002), ‘A balance sheet approach to financial crisis’, IMF Working Papers, No. 210, International Monetary Fund, Washington, D.C.  8  See L. D. Papademos and J. Stark (2010), Enhancing Monetary Analysis, ECB, in particular chapter 7, ‘Cross-checking and the flow of funds’.