It is these more deep-seated trends, which were in place before the crisis, that are really the greater cause for concern; the crisis has brought them more sharply into focus. The demographic drivers will continue for the foreseeable future, while the unwillingness or inability to tackle the structural trends in earlier “good times” has significantly reduced future flexibility.
For a start, the vast majority of banks have capital buffers above the thresholds implied by the SREP decisions, which in those cases means that an increase in capital requirements would actually have little or no effect on the banks’ credit supply.