Mr. Patrick Neary:

The system of regulation that was put in place by the ... by the authority failed. There is no denying that, it's a fact. In its defence, I would say it was the same system that was used throughout Europe and it is clear now that that whole system, throughout Europe, also failed.

Now, you have to put it in the context as well of the CRD or the Basel II structure. I mean, the way in which that was evolving was to, if you like, rubber stamp the whole approach ... principles-led regulatory approach going forward in Europe, whereby further responsibility was being transferred away from regulators to the boards and management of banks. They could determine their own capital requirements, they could determine the add-ons for other risks, like operational risk and concentration risk and things like that. And, it was ... it was grounded on ... on the premise - and this came from the Commission and it came after lots of consultation - that the capital requirements in Europe were too high, it was adding to the costs of financial services in Europe and that a way should be found to let banks have more say in the way they structure their businesses. And that was ... that's the philosophy that was behind our principles-led supervision, and it clearly failed. There is no denying that.