Although these reforms were implemented with fits and start, they were accelerated in 1997 when the Nawaz Sharif Government brought in professional managers and boards of directors consisting of reputable persons from the private sector to manage and oversee the nationalized commercial banks. The Central Bank was granted autonomy and the control of the Ministry of Finance over banking institutions was diluted.
Nevertheless, a credible range of recovery and resolution scenarios could and should be developed. Another unclear aspect is how we can assess the potential systemic risk implications of certain CCP recovery tools, such as repeated cash calls, partial tear-up or variation margin gains haircutting.