One is that capital requirements should be conservative, reflecting the importance to New Zealand of sound credit ratings, given our reliance on offshore borrowing and susceptibility to international shocks. Another is that capital requirements should be set in relation to the risk of bank exposures.
This is 2/5  BIS central bankers' speeches  the unhealthy relationship between countries and their banks, whereby banks lend on a large scale and without a capital charge to their home countries, while governments simultaneously find they must support struggling banks in order to prevent an immediate crisis.