of existing supervisory guidance – which cover capital planning and management of funding and liquidity risks – discuss using stress testing or addressing potential adverse outcomes in order to enhance risk management practices. this guidance is applied commensurate with an organization ’ s size, complexity and risk profile. for example : • community banks – those with below $ 10 billion in assets – are not expected to conduct the type of stress testing required or expected of larger banking organizations, as indicated in recent rulemakings, proposals and guidance. a community bank may still employ certain other types of simpler stress testing to augment their risk management – as many community banks have been doing for some time. • in contrast, regional banks – which are typically those with assets between $ 10 and $ 50 billion – are indeed required to conduct a company - run stress test on an annual basis. still, regional banks are not subject to many other stress testing requirements imposed on larger firms, such as going through a supervisory stress test or conducting an additional stress test each year. moreover, our reviews of those company - run stress tests are focused primarily on the quality of the processes those firms employ and not necessarily the results. our goal with regional banks is to ensure that managers at those firms recognize their vulnerabilities and develop appropriate mitigation strategies to enhance their resilience. 4. structure and culture : the final area, or challenge, i wanted to touch on is organizational structure and culture. firms need to ensure that business strategy, organizational structure and desired culture are aligned to successfully operate in a fast - paced, ever - changing world. whether you are a small community bank or a large global institution, you need to be agile enough to act quickly without risking the integrity of your structure and culture. i will touch on culture again a little later. in the short term, these are issues that we see as “ top - of - mind ” in terms of challenges and should continue to be areas of focus for firms. i thought i would close out today with thoughts on two areas. at times i have described these as being on my list of “ things that keep me awake at night, ” and i think it ’ s fair to say that these two issues continue to be near the top of that list. they are : information technology and culture. what keeps me awake at night 1. information technology my first issue is a topic that i had the opportunity to address with many of you earlier this year : the broad area of information technology, which

additional capital and liquidity, for example, can provide to the system. the topic is a daunting one, but one that we have to address in the very near - term. it is an area that will continue to warrant attention and will require a level of coordination and collaboration between the public and private sectors. in many respects, i think we are all in this one together. the second dimension is legacy : there is still so much “ clean - up ” to do to fix longstanding technology and data issues that have built up over the years. the investments necessary are long - term and the fixes, in many cases, will take multiple years to execute. a number of firms have sound programs in place to address these longstanding issues, but continued strong project management and tenacity are crucial. i see commitment to this basic “ blocking and tackling ” as essential to financial institutions continuing to be competitive – and relevant – in the digital world. and that ’ s the third dimension that concerns me : the competitive landscape for financial institutions in the digital world. as more and more non - financial entities are entering the financial arena, i worry that financial firms may lack the agility and ability to compete at the level that they need to – particularly with the added complexities ( and likely constraints ) of regulation. at the end of the day, will financial firms be able to compete in the same way – or will these largely unregulated players be the future of our financial system? 2. culture my final topic today is culture – a complex topic that we all know it is an important one. before i get into this in detail, i want to stress that “ culture ” is very different from “ risk culture. ” you can have a strong risk culture within your firm, but still have cultural issues. the culture i am talking about today is broader and deeper. there seems to be a general acceptance that there needs to be changes to the overall culture in the financial services industry, as well as improvements to cultures within individual firms. however there continues to be a lot of mixed views around how the changes can and should be initiated and implemented. the interconnectedness of the industry has resulted in the public viewing the industry as “ one. ” therefore, i believe to address the tarnished reputation of the industry as a whole in a credible and sustainable way, firms must be willing to address it with a unified front. bis central bankers ’ speeches culture is a bit of a ne