In recent years, however, with the major changes particularly in South Africa’s international financial relationships, the money supply model lost some of its usefulness. Over the past four years, the rate of increase in the money supply has persistently stayed around the level of about 15 per cent, being about 5 full percentage points above the annual guidelines of the Reserve Bank.
Since we have not yet formally issued the proposed rules for public comment, I will provide just a brief overview on aspects of the proposal that the agencies have already discussed publicly. The proposed U.S. standardized approach will be based on the approach of the same name in the international Basel II framework, modified in some areas to suit the U.S. banking system.