I do not need to underline how this approach can turn into a formidable multiplier of market turbulence. The expectation that the central bank will aggressively protect the markets from “tail events” in bad times can encourage – and did encourage, in my view – markets’ tendency to opt for risky strategies, over-exposures and exuberance.
We are now at a point were progress is evident and, notwithstanding specific areas for improvement by banks, we are moving along the right path. Mortgage arrears remain a significant priority for the Central Bank and we will continue our programme of intensive oversight of the banks’ progress. 2  BIS central bankers’ speeches