We find many violations of regulations occur not intentionally but due to ignorance or lack of appreciation. There is surely enough scope for bringing in improvement in this regard. The well thought out sessions planned for this conference, in a sense, will provide many insights to our understanding of some of the current issues relating to our financial markets.
In this sense, small business loans and CMOs are on one side of the fence, and Treasury securities are on the other. Before proceeding, I should note a natural first reaction to these observations. You might say, “Of course banks prefer holding riskier securities to riskless ones, even if they create no monitoring value in either case.