the 2008 financial crisis? of course not. while we have seen stress in some parts of the banking system, overall the system is strong and resilient. u. s. banks have high levels of capital and liquidity, and banks of all sizes continue to support the economy. to a large degree, this strength comes from the work done at the direction of congress, most recently pursuant to the bipartisan economic growth, regulatory relief, and consumer protection act, which better aligned regulation with risk. 3 the strong set of laws and regulations we have today suggests that the problems in the banking system require a targeted solution, one focused on actual risks, on improvement of supervision and risk management, and on prompt remediation of supervisory issues. not only is the current tailoring approach robust, it also results in efficiency. tailoring distinguishes firms by size, risk, and complexity, and imposes appropriate regulatory requirements in light of these differences. the board considers a number of factors when evaluating the largest firms, including size, cross - jurisdictional activity, reliance on short - term wholesale funding, off - balance sheet exposures, and nonbank assets. these characteristics, and the g - sib scoring methodology more broadly, help distinguish the largest firms that pose the greatest risks from smaller and less systemic firms. even for smaller firms, we have clear regulatory standards and thresholds to ensure that supervision is appropriately tailored for each institution. this framework provides appropriate scale for both regulators and for banks. it strikes the crucial balance between safety and soundness and ensuring that well - supervised and regulated banks are able to continue providing credit to their local and regional businesses and communities. economic growth, regulatory relief, and consumer protection act, pub. l. no. 115 - 174, 132 stat. 1296 ( 2018 ). - 6fundamentally, we should be careful not to undermine tailoring and risk - based supervision. while there were some clear lapses in the supervision of silicon valley bank, our fed supervisors and those with the other banking agencies are dedicated public servants who i am confident will embrace the lessons learned from the recent bank failures. we need to provide examiners with direction and support to promote safety and soundness in the banking system. the banks that recently failed were unique in their operations and business models. these failures alone do not justify layering on inefficient and overly complex supervision on a broad range of other banks. nimble supervision one reasonable expectation from the many reviews of the

mr. greenspan looks at the need for financial reform and the importance of a decentralized banking structure in the united states remarks by the chairman of the board of governors of the us federal reserve system, mr. greenspan, at the annual convention of the independent bankers association of america in phoenix, arizona, on 22 / 3 / 97. as always, it is a pleasure to address this convention of the independent bankers association of america. this is the sixth year i have addressed this convention, and during that time four separate congresses have debated how best to reform the financial system. i last spoke to you about financial reform in 1994, in orlando, and it is clear that the real world occurrences of the past three years have not diminished the relevance of those words. therefore, i shall reemphasize some of those thoughts today in the context of legislative proposals that are now before the current congress. let me begin by reiterating the essential thrust of the federal reserve ’ s position regarding financial reform. we believe that any changes, either in regulation or legislation, should be consistent with four basic objectives : ( 1 ) continuing the safety and soundness of the banking system ; ( 2 ) limiting systemic risk ; ( 3 ) contributing to macroeconomic stability ; and ( 4 ) limiting the spread of both the moral hazard and the subsidy implicit in the safety net. my remarks today will focus primarily on the macroeconomic and risk implications of financial reform and how, in particular, such reform must enable community banks to maintain their critical role in the macroeconomy. the importance of the community bank our banking system is the most innovative, responsive, and flexible in the world. at its core is a banking structure that is characterized by very large numbers of relatively small banks - - more than 7000 separate banking organizations. this banking structure is very different from that of other industrialized nations - - for example, there are less than 500 banks incorporated in england, germany, and canada combined. to be sure, the very largest u. s. banking organizations account for the lion ’ s share of banking assets. still, no one institution controls more than 6 percent of total domestic banking assets in the united states. this highly decentralized, highly diverse banking structure is almost certainly the direct result of our market economy itself. indeed, it is revealing that the first edition of adam smith ’ s wealth of nations was published in 1776, the year of the birth of our nation. our market - driven economy,