The laxity in the governance oversight functions as a result, cost tax payers billions of dollars in the bailout by various governments of the affected financial institutions and industries. What happened also heightened the concern over unwarranted risks. Financial institutions continued to accept risks well above their required risk margin, given their resources.
Furthermore, an international agreement on a framework for financial sector reform should be arrived at. Maintaining central bank credibility as well as fiscal and regulatory credibility are essential to restore confidence to the IMS. However, it is still not clear how any reform mechanism can impose adjustment on surplus countries.