iv)  The weekly repo auctions will be held at 11:00. and the results will be announced on Reuters’ “CBTG” page no later than 11:30.The traditional method will be used in auctions; in other words, the successful bidders will be evaluated with their own interest rates. v)  In case of unforeseen excessive liquidity shortage during the day, which would exert excessive pressure on money market interest rates, the CBRT may announce “Intraday Repo Auctions” in addition to the regular ones announced at 11:00.  vi)  The primary dealer banks will be able to conduct repo transactions within the framework of open market operations, between 10:00-12:00 and 13:00-16:00.  vii)  In case of an excessive increase in the liquidity surplus in the market, mainly the Central Bank liquidity bills with maturity up to 91 days, and when necessary New Turkish Lira deposit buying auctions with standard maturities of 1, 2 and 4 weeks and reverse repo auctions with maturities up to 91 days will be used actively, in order to enhance the effectiveness and flexibility of monetary policy and liquidity management strategy. However, the Central Bank will continue to focus on sterilizing the excess liquidity, which is at such a level that would bring the overnight interest rates in the money markets close to the Central Bank borrowing rates, through overnight transactions.
By moving the banking industry collectively back to Figure 1 from Figure 2, the “bad state of the world” becomes less likely. In the SCAP, we had to make a number of important decisions. These included:   The appropriate capital target. We focused on the Tier I common ratio because we believed that this was the most credible form of capital. This put much greater emphasis on common equity than previously.   The severity of the stress test. We assumed a stress scenario with an unemployment rate 1.5 percentage points higher than the baseline scenario, and further home price declines of about 29 percent compared with 18 percent in the base case. We were aiming for a stress test scenario that had about a 5 percent to 10 percent probability of being realized.   The capital target at the end of 2010 and the stress test severity were both important in terms of the credibility of the SCAP. Going in, we were worried that with our capital goal, the BHCs’ needs might turn out to be higher than the available  BIS central bankers’ speeches  3  resources from the private sector and the U.S. Treasury. We decided not to compromise the credibility of the stress test to save on needed capital resources.