At a time when regulation of financial markets has been subject to major upheavals this survey will be of particular value. The author is one of the most prominent officials involved in formulating and executing regulatory policy. His concern is to ensure that the new environment of liberalized markets in which international universal banks compete does not lead to bank failures and systemic losses. He describes trends in regulation over the past forty years and how those trends have been shaped by the Basel Committee; he addresses the question 'Why regulate?' and 'How to regulate'. While discussing these issues at an international level, the last three chapters focus on developments in Europe in the light of changes brought about by monetary union.