can prevent him from cheating you. the risk in such cases is greater than the profits. ” fifth advice “ pay your officers such salaries as will enable them to live comfortably and respectably without stealing ; and require of them their entire services. if an officer lives beyond his income, dismiss him ; even if his excess of expenditures can be explained consistently with his integrity, still dismiss him. extravagance, if not a crime, very naturally leads to crime. a man cannot be a safe officer of a bank who spends more than he earns. ” sixth advice “ the capital of a bank should be a reality, not a fiction ; and it should be owned by those who have money to lend, and not by borrowers. the comptroller will endeavour to prevent, by all means within his control, the creation of a nominal capital by national banks, by the use of their circulation, or any other artificial means ; and in his effort to do this, he confidently expects the co - operation of all well managed banks. ” seventh advice “ pursue a straightforward, upright, legitimate banking business. never be tempted by the prospect of large returns to do anything but what may be properly done under the national currency act. ‘ splendid financiering ’ is not legitimate banking, and ‘ splendid financiers ’ in banking are generally either humbugs or rascals. ” these are the seven chief mantras of good banks and good bankers. they are atemporal - indeed timeless. they were valid more than century ago ; they are valid today and they will continue to remain valid. the new co - operative bank ltd is starting operation. a note of caution is appropriate on this occasion. never attempt to grow big too fast. make sure that all loans are adequately and legally backed by valid securities - whether the loans are made to co - operative societies or to individuals. when a bank lends few thousands of rupees it is the borrowers ’ headache to repay the loan ; when it lends millions of rupees it is not the borrowers ’ headache but the bankers ’ headache to recover the money lent out. a small bank with a healthy and sound balance sheet is stronger than any big bank with a weak balance sheet. i seize this opportunity to reflect on one particular aspect of the way policy decisions in some banking enterprises are made in mauritius. of all the five revocations of banking licences in mauritius, three were clearly motivated by problems the

war period. and it was the victors of the second world war who shaped it to suit their particular interests. we have been talking a long time now about voice and representation, and changing the voting structure in the governance of the world bank and the imf. in the throes of this crisis, some tentative changes have finally been agreed and are beginning to happen. so, for the first time ever, some of the glaring inequities in the voting structure have been corrected and we hope that this process will carry on. the current system is built on the convention that the ceo ’ s of the bis central bankers ’ speeches imf and world bank are respectively european or american. the wto has also been headed by a european since its creation. to look at the governance of this unholy trinity, you would not know that the centre of gravity of the world has changed to china and india. there is a need now to recognise the new reality of the world. the next managing director of the fund is most unlikely to be a european. there are other changes that are happening, in terms of the actual remit of the fund to ensure global surveillance, global financial stability, and address problems posed by countries running large and persistent balance of payments surpluses. a fundamental weakness of the imf – apart from being weak - kneed vis - a - vis the us – was the built - in asymmetry in its approach : a roaring tiger where deficit countries were concerned but a softpurring kitten when faced with surplus economies. as you know, the global cry at the level of the g20 is for rebalancing economies. we have to watch how this global re - balancing is going to happen, who is going to have the power to achieve it, and perhaps what shape the new emerging international financial architecture is finally going to take. there will not be any cut - and - dried solutions. instead, it ’ s likely to be a long drawn - out process. the fear is that the receding crisis, itself a highly - desired outcome, may have the unintended consequence of abating the pressure for reform. in any event, the world as we know it is likely to change – at least in terms of the currencies in which most transactions are conducted. whether the hegemony of the dollar is going to continue or not is an open question. all of you may have your own views on it. is the euro going to survive