For that reason, the Treaty calls — and, in our opinion, unquestionably calls — for a two-year membership in ERM without tensions.
This, however, is subject to the stipulated prudential floors for the first three years of implementation to guard against any significant decline in the capital ratios of the banks arising from the capital relief that they might accrue to them under Basel II. The banks are, however, expected to operate at a level well above the minimum capital requirement.