Rather, it appears as though much of the decline has occurred in the equilibrium level of the real interest rate—also known as the natural rate of interest or, alternatively, r*.
When banks used manual processes, errors were confined to the limited area where the employee worked. But in a modern technology setting, factors such as breakdowns in controls, errors in software code, and processing stream interruptions can have enterprisewide effects on the performance of the organization. Recent history provides us with ample evidence that operational risk can be significant.