Banks have criticised these proposals, since traditionally capital exists to protect a bank against only unexpected losses, while reserves are held when bank expects to experience credit losses. We are now seeking to revise the treatment of credit losses to calibrate capital only to losses that are not anticipated - or “unexpected losses” - and we have issued a proposal for comment on how to do so on our website. We will continue to evaluate the soundness of our assumptions in the New Accord and their relative degrees of conservatism in the final months ahead. Competition and the balance between flexibility and consistency Applying the New Accord consistently across countries is an essential goal for the Committee. By incorporating minimum standards in the New Accord, we want global competition in banking markets to be driven by each bank’s strengths, rather than by differences in each country’s rules. Moreover, Pillars Two and Three were created to a great degree to level the playing field for banks by encouraging more consistent supervisory approaches and public reporting. To advocate greater consistency in the application of the new rules, the Committee created the Accord Implementation Group to share experiences and encourage shared approaches. We expect these discussions to help supervisors apply the New Accord more consistently and to encourage greater cooperation among supervisors, which was one of the three words - together with balance and consistency - that I mentioned at the beginning as guiding the Committee’s work on the New Accord.

It often requires several pre-conditions to be in place, it requires having the enabling environment and the different parts of the public sector to come together to act cumulatively to deliver the results. Frequently, this synchronisation does not happen. Strong convictions on the cause, reinforced by the capabilities and supported by the perseverance increases the potential to produce results that makes the difference. Finally, and most importantly is the ability for continuous reinvention. The changing environment is more globalised, more competitive, more uncertain and ambiguous, more technologically driven, more prone to crisis, and is subject to greater scrutiny and demands for greater transparency. This more difficult operating environment demands new skills and abilities to manage these new challenges. Indeed, the role of leadership is dynamic and has changed considerably. Reinvention is to support the ability to creatively respond to change. Building effective organisations To strengthen our ability to manage the new challenges arising from the changed environment, equally important is building effective organisations with the capabilities that will deliver results. This will involve organisational reviews and the continuously modernising of the organisation so that it can continue to best serve the nation. Such endeavour will require periodic environmental scans and envisioning to revalidate the strategic thrust of the organisation. Modernisation efforts then need to be supported by a blueprint of the strategic steps and initiatives that need to be taken. Women that have the capability must be brought in at the leadership levels to participate in this process.