This is especially relevant to satisfying the need for longevity risk  2  For a theoretical framework of rational decision under investment irreversibility and (fundamental) uncertainty à la Frank Knight, see Nishimura, K. G., and H. Ozaki, “Irreversible investment and Knightian uncertainty,” Journal of Economic Theory, 136 (2007) 668–694.
To close, let me underline that the new guidance we are giving to banks in the form of the revised Basel Accord should, to a large extent, reflect “sound market practises”. To obtain an optimum result, it is essential that banks contribute to this regulation by providing technical input. 3  BIS Review 128/1999