This would not be a concern to the extent that it merely reflected a broader process of deleveraging and reduced risktaking. But we should guard against actions that unnecessarily reinforce this trend and reverse the long-term progress towards global financial integration.
For example, actions to support banking systems should not distinguish between domestic and foreign-owned institutions, nor should credit be diverted to domestic borrowers through subsidies or inappropriate regulatory incentives. Stabilising the financial sector also includes establishing greater clarity on what the regulatory framework will look like in the longer term.