At present, we cannot quantify precisely how much Basel II, once fully implemented, will affect banks' risk-based capital requirements relative to Basel I levels. Although our quantitative impact studies have been useful, they have been conducted using bank systems and measurements that generally would not be expected to meet the Basel II standards.
A number of countries, including both advanced and emerging-market economies, have already deployed such measures, and their experiences should be instructive. Although, in principle, monetary policy can be used to address financial imbalances, the presumption remains that macroprudential tools, together with well-focused traditional regulation and supervision, should serve as the first line of defense against emerging threats to financial stability.