Therefore, in my opinion, a capital regime that is also geared to total assets is absolutely necessary. Hence, the leverage ratio is to become part of Pillar 1 of Basel III and thus binding from 2018. Stricter capital requirements will help to increase the internal capital adequacy of banks. But capital does not come for free.
The latter part of the decade was characterised by a significant depreciation of the South African currency and, in 2002, we experienced our own banking instability. Fortunately, and owing particularly to the solid foundations upon which our banking system is based, 2003 and 2004 were marked by greater stability.