. such approaches were used for more than 80 per cent of the relevant banking assets at 1 january 2008. i would also like to point out that the impact of basel ii on credit institutions ’ capital goes beyond the capital requirement calculation stipulated in pillar 1 ( even though it provides more comprehensive coverage than basel i of new risks, such as securitisation activities ). regarding pillar 2, the new regulations call for major additional arrangements to refine banks ’ risk management and planning for capital cushions. this could lead to additional capital requirements, or other appropriate measures to enhance bank stability by considering risks that are not dealt with or are inadequately dealt with under pillar 1. by the end of the year, this approach should lead to individual ratios for each institution that the commission bancaire sets on the basis of structured dialogue with each institution. we have also undertaken a series of major actions that are directly in line with the general framework of the recommendations made by the financial stability forum. many spheres of action have been defined, but i would like to speak about three that i think are priorities, starting with transparency and valuation, followed by adapting the capital requirements set by basel ii for certain instruments, and finally, liquidity risk. first of all, enhancing transparency and financial disclosure was quickly identified as one of the key requirements for ending the crisis. we have urged french banks, in conjunction with the national institute of statutory auditors, the cncc, to provide detailed disclosures of their subprime exposures. a joint working group made up of staff from the commission bancaire, the autorite des marches financiers and the french banking federation has defined best practices in this area. institutions have started implementing them in a satisfactory manner and practices should be further improved in the financial statements for first - half 2008. in 2009, the basel committee is planning to publish recommendations on information to be disseminated under the requirements of pillar 3 of basel ii. in - depth discussions with banks led to a convergence of practices for asset valuation, including the priority on relying on prices and directly observable market data. where banks have had to use valuation models because liquid prices disappeared in some markets, the recommendations deal with consideration of all risks – including liquidity risk and counterparty risk – and the rigorousness of the process for determining such prices. with regard to adapting the basel ii requirements, we are also playing a very active role in the various international working groups led by the basel committee to give greater consideration,

25 % and at least one characteristic suggesting debt - repayment difficulties. vulnerable unsecured debtors are those with less than 25 % housing equity ( including renters ) and at least one characteristic suggesting debtrepayment difficulties. ( b ) based on historical bhps data and more timely information from the annual nmg survey. differences in survey questions and sample size mean the estimates from the two surveys are not directly comparable. bis central bankers ’ speeches chart 13 : chart 14 : corporate financial surplus ( a ) percentage of firms with interest payments greater than profits ( a ) ( b ) per cent united kingdom united states euro area per cent firms with turnover > £1 million firms with turnover < £1 million real estate firms with turnover > £1 million + source : thomson reuters datastream, ecb and bank calculations. ( a ) per cent of gdp except euro area which is as a per cent of gva. sources : bureau van dijk and bank calculations. ( a ) percentage of companies in each category with interest payments greater than their profits before interest. ( b ) data include firms reporting turnover, profit and interest paid. these firms may not be representative of the population. total sample size varies over time, ranging from around 14, 000 in 1990 to over 90, 000 in 2000. changes in the composition of the data set may reduce comparability over time. subsidiaries, as identified from company structures, are excluded. company accounts are assigned to calendar years according to the statement date. the real estate sector is identified using sic ( 2003 ) and sic ( 1992 ) codes ( the sample ranges from around 450 to 1, 600 firms ). bis central bankers ’ speeches chart 15 : chart 16 : changes to uk gross government debt ratio in crisis periods public debt ratios in g7 countries 1929 crash 1990 recession cumulative pp change since start of recession 2008 financial crisis ppp weighted percentage of gdp years since crisis - 5 1940 1950 1960 1970 1980 1990 2000 2010 sources : office for national statistics, thomson reuters datastream and bank calculations. sources : imf historical public debt database, imf world economic outlook ( april 2011 ), angus maddison historical statistics and bank calculations. bis central bankers ’ speeches chart 17 : chart 18 : real lending growth rates uk credit - gdp gap ( a ) ( b ) percentage points percentage changes on year earlier norway ( 1988 = 0 ) sweden ( 1990 = 0 ) finland ( 1990 = 0 ) united kingdom ( 2007 = 0 ) + 1 - 0 + 1 9 10