To reduce systemic risk, better regulation of the shadow banking system will be necessary too. This could be done either directly, by regulating the activities and actors of the shadow banking system themselves. Or indirectly, by regulating banks’ interactions with the shadow banking system. 4  Need for international cooperation  Let me close by emphasising once more the urgent need for international cooperation.
More than 4 years after the outbreak of the crisis, we are now at a crossroads. Our cooperation in  2  See FSB, Shadow Banking: Scoping the Issues, A Background Note of the Financial Stability Board, 12 April 2011.