This is, of course, only feasible for those, primarily large, banking organizations that rely on uninsured liabilities in a significant way. To be sure, these organizations already disclose a considerable volume of information to market participants, and, indeed, there is ample evidence that market discipline now plays a role in banking behavior.
Nonetheless, the scale and clarity of disclosures is better at some institutions than at others and, on average, could be considerably improved. With more than a third of large-bank assets funded by non-insured liabilities, the potential for oversight through market discipline is significant, and success in this area may well reduce the need to rely on more stringent governmental supervision and regulation.