” as i previously noted, establishing an appropriate and responsible transparency regime for emergency lending in the midst of a severe crisis is an especially challenging task. with sufficient time to assess the maximum amount of information that could be released without frustrating its mission, the federal reserve now discloses extremely detailed information to the public about all of its facilities. 5 however, the fact that such information was not instantly available gave rise to public criticism. another lesson that emerged strongly in this phase of the crisis was the need for adding to the regulatory toolkit a robust and effective method for resolving complex financial institutions without imperiling the safety of the broader system. in the case of bear stearns, the presence of a willing acquirer presented the opportunity for an assisted transaction that effectively amounted to an ad hoc resolution mechanism for the failing firm. one sense in which this solution was ad hoc was that policymakers could not be sure that a willing acquirer would be found in the case of distress in the future, but another, perhaps more important sense is that the rules of the game were not clearly established in advance. in this context, it is worth noting that the united states had led the world with its federal deposit insurance corporation ( fdic ) improvement act in 1991 in establishing a state - ofthe - art resolution regime for depository institutions to avoid the panics and runs associated with the risk of insolvency of a financial institution, while at the same time protecting the taxpayers. however, this regime did not address how to efficiently resolve holding companies in the 1930s, congress had passed legislation giving the federal reserve additional flexibility in its lender - oflast - resort powers but these were removed with the passage of the small business investment act in 1958. most of this information can be found at the board of governors of the federal reserve system ’ s credit and liquidity programs and the balance sheet. that included a depository institution, investment banks or other financial institutions that were tightly and very intricately woven into the global financial system. perhaps because many thought that march 2008 was the height of the crisis, the overwhelming importance of this lesson coming out of the bear stearns episode did not translate into this gap in our regulatory framework being addressed with sufficient urgency. as i will discuss momentarily, the gap re - emerged as a main accelerant of the crisis with the collapse of lehman brothers in september of that same year. although, it is worth acknowledging in this context that congress did approve legislation setting up a special contingent resolution process

the operation of these mechanisms means that the combination of the lti ceiling and the ladder of differentiated ltv ceilings provides some in - built brakes in housing price dynamics. a further stabilising mechanism is that our macroprudential regulations can be tightened if there is evidence of materially - elevated risks in the mortgage market, especially in relation to adverse feedback loops between the rate of credit growth and house price increases. our commitment to an annual review process ensures that a rigorous evaluation of the mortgage measures is conducted each year, such that indicators of a combination of excess credit growth and unsustainable house price levels can be met by a revision in the rules. given this policy regime, participants in the housing market can be confident that the feedback loop between credit growth and house prices will no longer operate in an unbounded fashion. it is critically important to appreciate that our framework sets limits on the size of mortgages : the lti and ltv ratios are not targets but ceilings. in buying a home, a household should take into account the protections offered by putting down a higher deposit in terms of limiting repayment burden and risks associated with excessive debt levels. equally, lenders are required to assess the loan - bearing capacity of each mortgage customer and restrict the size of the mortgage if indicated by the analysis of the borrower ’ s credit risk. while the november 2016 revisions to the mortgage rules did raise the maximum loan size for first - time buyers seeking to buy homes above €220, 000 in value, it is important to take into account several considerations. first, borrowers also have to satisfy the lti requirement, which remains unchanged at a cap on loans of 3. 5 times income. for many households, this will limit the capacity to increase the mortgage size. second, the scope for exemptions to the ltv limit for first - time buyers has been restricted to just 5 percent of lending to this group, whereas the previous regime allowed 15 percent of lending above the ltv ceilings and did not restrict the allocation of exemptions between the first - time and second - and - subsequent buyer pools : in our analysis, many first - time buyers above the €220, 000 threshold were receiving exemptions ( or were looking for loans below the ltv ceiling ) so that previous rule was not fully binding. third, to the extent that the revision is contributing to an increase in aggregate mortgage credit volumes, this should be interpreted in the context of the subdued level of lending in recent years