There are risks of instability in the offing that hopefully will be effectively tackled by the Bank and other agencies in the years ahead. Thus far, the Bank has taken the stand that if the risk-taking behaviour of financial institutions cannot be regulated perfectly, it must impose some kind of prudential ratios to curb the volume of transactions.
Otherwise the Bank would commit the same fallacy as gun control opponents who argue that “guns do not kill people, people do”. As we are unable to regulate fully the behaviour of gun owners, we have no choice but to restrict the circulation of guns more directly. In an ever changing technological environment, new risks, new threats and greater regulatory challenges keep emerging.