The unintended consequences of the new prudential framework

Before implementing a new regulation, it is appropriate to reflect on its possible unintended consequences.

Politicians are determined to strengthen the financial system in order to avoid new crises such as the one we are still living through and which has resulted in such enormous costs in terms of growth, employment and public budgets. They can only be satisfied by the steep increase in capital requirements decided by the Basel Committee on Banking Supervision in September 2010 that will at le