The Basel I framework played an important role in raising capital levels across the banking system over the late 1980s and 90s. However, as recent events are demonstrating, it has increasingly failed to deliver on the four objectives I have listed.
Currently, many central banks in advanced economies have entered the realm of unconventional monetary policy such as the purchase of various types of assets to spur growth and to buy time as the sectors of the economy go through balance-sheet repairs.