Information gleaned from interviews undertaken both before and after the sub-prime crisis reveals that problems arising from Basel II implementation could go well beyond those issues primarily exposed by the crisis. In particular, certain of these issues have emerged from interview commentary that has revealed a potential for conflict between regulators and bank risk managers. Encounters with problems of this nature would be expected from the Habermasian perspective adopted in this book, because bureaucrats and banking personnel pursue different strategic interests. Conflicts of this kind have the potential to undermine the effectiveness of the Basel II framework in relation to its objective of stabilizing financial markets.
The following first section is going to expose the burdens confronted by banks in Basel II implementation, as reported by interviewees. The first two subsections are related to the methodology and relevant data issues.