We realized that, had we found ourselves in a crisis situation, the legal procedures would not have allowed us, as regulator to act rapidly to resolve matters and ensure financial stability. In times of crisis, no regulator can afford to wait for months on end for a bank to reorganize itself.
The problem was exacerbated by a number of objections – some of which came from within the banking sector itself. As we went from court hearing to court hearing, the whole restructuring process gradually became lengthier and more cumbersome, with the outcome increasingly unclear and uncertain. Of course, the Bank had a Plan B up its sleeve to fall back on.