The crisis brought with it a “sudden stop” to these capital flows, resulting in sharp adjustment, largely in deficit countries8. Subsequently, much has been done to address what we now recognise as deficiencies in the design of the Economic and Monetary Union – the European Financial Stability Facility and subsequently the European Stability Mechanism; the banking union and its components.
In addition, under our current plans, we also will be delaying issuance of an advance notice of proposed rulemaking to revise current capital rules for non-Basel II banks. U.S. banking regulators have longed recognized that the existing capital rules need to be updated. These modifications are needed to reflect changing products and risk exposures and also to address potential competitive impacts from Basel II.