Let us focus on: ·  how banks might determine the privately optimal amount of capital to hold;  ·  some factors which might cause the socially optimal amount of bank capital to diverge from the private optimum; and  ·  strategies to cause convergence between the socially and the privately optimal level of capital.
As for other troubled, but small banks, the public authorities, the banks’ own directors and fellow institutions are committed to finding solutions. The measures chosen eliminate the tail risk that in recent months has weighed on conditions at individual banks and on the sector as a whole, especially as perceived by financial operators.