It seems that banks and their supervisors are having to contend with a steadily growing array of risks. Derivatives risk, operational risk and environmental risk have all come to prominence in the past decade or so. And public relations risk is a major ongoing challenge for banks!
The First point that I want to make is that we need to recognize that the period of the 90s, despite many gains, has seen many more financial crises than the earlier decades. The most distinguishing characteristic of this period is a marked increase in volatility in exchange rates and capital flows.