It is noted that Northern Rock was regulated by the FSA and bailed out by the Bank of England. Importance of real time information The use of technology to produce an updated management information system on real-time basis and the re-engineering of business processes and systems are the tools which can help regulators to remain on the top of the potential problems.
This mainly has to do with the treatment of systemically important financial institutions and the financial system’s tendency towards (pro)cyclical behaviour. We, too, have to keep a closer eye on the limitations of the areas covered by regulation. After all, stricter regulation is of little use if activities are transferred to unregulated sectors and become concentrated there.