As credit risk is an important element in the unsecured markets, but not so in the secured markets, this may lead us to conclude that the increase in differences in credit risk across institutions, rather than increased segmentation, is the likely explanation for the observed small but noticeable increase in the cross-country standard deviation in interbank lending rates.
Little do we realize that all successful institutions in the world have properly trained and experienced hospital administrators, educational administrators, financial managers, supply chain and logistics specialists. On the other hand, here in Pakistan we have unqualified and inexperienced persons aspiring and competing for these positions simply because they carry privileges, perks and power.