But there, as well as some other parts of Latin America that seem to have dodged the bullet of a Brazilian-induced contagion, the potential for a letdown in their policy discipline that has served them well, also is a concern. But, in general, discipline is likely to hold, because the lessons of 1997 and 1998 are too recent and vivid to be soon forgotten.
Other measures, such as the inclusion of sovereigns in the large exposures regime might lead to more substantial repercussions, but these would be manageable if introduced over a transition period – which undoubtedly has to be granted. When it comes to funding costs for governments, a healthier banking system with better diversification would pose less of a burden on states.