We are also conscious that the international minimum standards are not calibrated to deal with some of the issues we face in New Zealand, including high industry and portfolio concentration. An interesting issue to address in this part of the review will be the future role and management of conservation buffers, including the counter-cyclical buffer, relative to the minimum capital requirements.
And this in turn will make further structural reforms easier, as in a stronger economy the short-term costs of reform are lower – for instance because transitions between jobs are faster and there is less risk of hysteresis effects. 2.