In the subsequent months of 1974, Germany established the Liquiditäts-Konsortialbank [de] and, at the international level, central bankers created the Basel Committee on Banking Supervision.
[1] With considerably more delay, concerns about Herstatt risk were revived in the late 1980s and 1990s and resulted in the creation of CLS Bank, operational since 2002 as a global foreign exchange market settlement utility.
That day, a number of banks had released payment of Deutsche Marks (DEM) to Herstatt in Frankfurt in exchange for US dollars (USD) that were to be delivered in New York.
Responding to the cross-jurisdictional implications of the Herstatt debacle, the G-10 countries (the G-10 is actually eleven countries: Belgium, Canada, France, Germany, Italy, Japan, the Netherlands, Sweden, Switzerland, the United Kingdom and the United States), Luxembourg and Spain formed a standing committee under the auspices of the Bank for International Settlements (BIS).
This payment versus payment (PVP) process enables member banks to trade foreign currencies without assuming the settlement risk associated with the process, whereby a counterparty could fail before delivering their leg of the transaction.