But the SREP is not only about capital, it is much more. The overall efficiency in operations and in credit allocation, as well as the stability and resilience of the banking sector do not depend solely on the level and quality of capital.
Capital should actually be a bank’s last line of defence, and the supervisory approach we believe in implies that we are not engaged in a simple box-ticking exercise, whereby internal processes and conduct features can be ignored as long as a bank holds enough capital.