Risk reduction and dealing with settlement failures Our regulatory role started to develop around 1990, a few years after we had entered the field of formal bank supervision for the first time in 1987. That responsibility, together with an increased focus on the issues internationally, awakened our interest in the size and nature of payment system risks.
We developed the view that the existing understandings about what would happen in the event of a bank failure were probably not very workable or satisfactory, and initiated a dialogue with the industry aimed at ensuring that payment system risks were identified, monitored and managed appropriately.