[lix] Among other things, it shows that a very small proportion (around 2 per cent) of the loans these vehicles own were given to Irish firms so the direct ‘real economy’ role of CLOs for Irish firms is small. [lx] The Central Bank does not prudentially regulate CLOs but that does not mean that they are without risk.
If the risk measurement and management systems of the bank are faulty, then holding a nominally high capital ratio -- say, 10 percent -- is little consolation. In fact, nominally high capital ratios can be deceiving to market participants.