This is where the stress capital position comes in: this is an exercise in projecting forwards the level of losses (and of profitability) – and doing so with an overlay of stress to provide an added degree of comfort and conservatism. As you know, this method has been used to good effect to force a significant recapitalisation of the system already.
How much uncertainty or risk is there in the medium term capital position for the banks? I’m afraid I’m going to disappoint you and say that we need to wait and see and do another thorough, rigorous and professional job of assessing that very question.