If the losses do materialize, the bank does not have to suddenly declare a big loss, it can set the losses against the prudential provisions it has made. Thus the bank balance sheet then represents a true and fair picture of the bank’s health, as a bank balance sheet is meant to.
There could be a need to strengthen our research studies related to structural reform and put forward feasible policy alternatives. As we have witnessed in the process of public sector reform, even if the policy directions for structural reforms have been properly established, their implementation remains difficult unless they are supported by social consensus.