Prior to the global financial crisis there was insufficient understanding of financial systemic risk in countries around the world, and we cannot deny that the significance of such risk was underestimated.
2  BIS Review 133/2008  •  Another problem is the overstatement of capital or double gearing whereby the capital of one entity is used to satisfy the requirements of more than one affiliate entities. This phenomenon is typical where investments are made by the parent body in its subsidiaries.