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did not suggest mandatory limits for borrowing or ways to manage risk, and also said that some of the recommendations would not be practical for smaller funds. Managers must apply those that suit their own business model since funds vary by size, nature, complexity, strategies, and resources.

Outside the United States, initiatives have occurred as well. In January 1999, in Basel, Switzerland, the Bank for International Settlement proposed tough standards for banks such as setting loan limits, and gathering better information from funds on risks of investors. In late 1998–1999, banks became stingier with credit. They demanded transparency, greater disclosure, additional reporting requirements, efforts to monitor derivatives, and modified standards for hedge fund investors.

By January 26, 2000, the Bank for International Settlement observed that competitive pressures again had led banks to cut corners, slip in credit standards, and have mixed adoption of new standards.