The extensive use of derivatives and short sales of securities compounded losses and increased the need for liquidity when asset prices declined. In view of such developments, credit risk management becomes extremely important because of the dangers of default and large bad debts in the banking sector. In the recent crisis South Africa was fortunate to have had efficient and well-run banking institutions.
Continued attention will have to be given in the coming years to sound risk management and to devoting even more resources to the maintenance of stability in the financial sector.