As I have indicated previously before this committee, dramatic advances in computer and telecommunications technologies in recent years have enabled a broad unbundling of risks through innovative financial engineering. The financial instruments of a bygone era, common stocks and debt obligations, have been augmented by a vast array of complex hybrid financial products that has led to a far more efficient financial system.
The Bundesbank therefore welcomes a return to a lending policy more in line with the catalytic role of IMF financing, a policy which the IMF generally endorsed last year. Establishing credible ex-ante clarity about financial assistance is crucial in this respect.