As is already the case, the supervisory review process may lead not only to the imposition of conditions in specific cases but also to explicitly higher capital ratios, exceeding the present 8% limit. This option must be available as a kind of last resort.
In terms of financial stability safeguards, we now have a deeper policy toolkit to deal with external and domestic shocks to the system. These tools will allow the BSP to respond to the formation of imbalances and address the build-up of system risk. First, we continue to implement a flexible exchange rate regime as our first line of defense against external shocks.