Mr. Cormac McCarthy:

Certainly, Senator, and the papers that have been presented show a narrative on this. The cap was 250% from the early 2000s and it became clear to us that there were challenges around that limit in a number of institutions, so there was a sense that that was honoured more in the breach than the observance. We engaged in a conversation with the regulator as to whether that limit could be changed. As Basel II was coming along, and portfolio analysis was increasingly getting more detailed, it would have been possible to change the risk profile to such an extent that you would get a greater allowance above the 250%. So there was an ongoing discussion with the regulator over a number of years and after ... in 2007 the regulator agreed to increase the cap to 500%.