The Securities and Exchange Commission’s Report to Congress contains a detailed assessment of the impact of Basel III and the Volcker Rule on liquidity in US Treasury and corporate debt markets (SEC (2017)). 15  All speeches are available online at www.bankofengland.co.uk/speeches  15  risk-weighted assets (Bank of England (2015c)). Table 1: Overall Implications of Research Findings for Optimal Capital Impact on optimal capital: Benefits: Likelihood and severity of crises Impact of capital on probability of crises Impact of capital on severity of crises Impact of TLAC and resolution regimes on prob. and severity of crises Costs: Impact of capital on credit conditions and growth Impact of capital on market liquidity (leverage ratio) in normal conditions  The System of Financial Regulation  Regulatory reform has tended to progress crisis by crisis, market failure by market failure, regulatory standard by regulatory standard. This is not especially surprising, given the nature of the policy design process. Nonetheless, if we put together the various pieces of recent regulatory reform, we find a fundamentally different regulatory jigsaw, or system of financial regulation, than in the past. One important dimension of that new architecture is the significantly larger number of regulatory rules or constraints that now operate. On top of risk-based capital standards have been added regulatory rules for liquidity, leverage and loss-absorbing capital. In other words, we have moved from a system of largely uni-polar regulation to multi-polar regulation (Haldane (2015)).

INTERNATIONAL MONETARY AND FINANCIAL COMMITTEE  Forty-Sixth Meeting October 13–14, 2022 Statement No. 46-11  Statement by Mr. Taleb Algeria On behalf of Islamic Republic of Afghanistan, Algeria, Ghana, Islamic Republic of Iran, Libya, Morocco, Pakistan, Tunisia  Statement by Honorable Salah-Eddine Taleb Governor of the Bank of Algeria On behalf of Afghanistan, Algeria, Ghana, Islamic Republic of Iran, Libya, Morocco, Pakistan, and Tunisia Since our last meeting, the global economy has weakened further and its prospects have become more uncertain, reflecting the three recent major overlapping, connected and mutually reinforcing global crises: the lingering supply-demand imbalances of the pandemic; the fallout from the war in Ukraine; and soaring inflation. The “cost-of-living crisis” has hit vulnerable countries everywhere and vulnerable groups in every country, including the middle class, the hardest. To be clear, the underlying global price pressures, particularly food and energy, were already evident in late 2021, but were sharply accentuated by sanctions and disruptions caused by the war in Ukraine. Virtually all risks identified by the April 2022 WEO materialized, but the inflation surprise seemingly blindsided policymakers in major countries, compelling them to move aggressively to tighten monetary policy. The negative spillovers of the tightening of global financial conditions are being acutely felt in Emerging Market and Developing Economies (EMDEs), including the frontier economies and middle-income countries in our constituency, through currency depreciation, capital outflows, higher external debt servicing cost, and diminished (or even loss of) access to international financial markets.