8  BIS central bankers’ speeches  The pre-crisis period saw too much “borrowing short to lend long”, and too much reliance on the assumed availability of market funding. Banks everywhere have been adjusting away from that model over recent years, Australian banks among them. The share of offshore funding has fallen, and its maturity has been lengthened (Graph 8).
The pre-crisis system did its job for many years. By promoting standardization, structuring securities to meet a broad range of investor risk appetites, and issuing guaranteed MBS, Fannie and Freddie brought greater liquidity to mortgage markets and made mortgages more affordable. 1/6  BIS central bankers' speeches  But the system ultimately failed due to fundamental flaws in its structure.