Monetary policy  Recent monetary policy should be seen against the backdrop of the developments outlined above. Between June and December of 2003, the repo rate was reduced by 550 basis points, bringing the  4  BIS Review 28/2004  repo rate to 8,0 per cent, the lowest nominal level for this interest rate or its predecessor, the Bank rate, since 1980.
Separating deposit-taking and lending from capital market transactions is said to prevent a crisis from spilling from one of the areas of business into the other. This would allow “good” banks to fulfil the important task of supplying the real economy with credit while being shielded from risks inherent in investment banking.