As the old saying used to go, “Never trust anyone over 30”. That catchphrase was popularised by the 1968 student movement – the students who used it are now themselves over 60! Trust is indeed the key word. Its importance is being learned by governments and banks alike as the sovereign debt and financial crisis tightens.
So it is a good thing that the day-today dealings between the banking associations and individual banks, on the one hand, and central banks and supervisory authorities, on the other, are characterised by mutual confidence and trust – notwithstanding the necessary arm’s-length relationship between central banks and supervisory authorities, on the one hand, and banks and their associations, on the other.