efforts will contribute not only to strengthening the supply side of the economy, but also to generating sustainable demand. in other words, by using innovation as a lever to reallocate production resources dynamically to growing sectors, the demand and supply sides of the economy may be expected to expand in a mutually complementary manner. needless to say, corporate executives, including many of you here today, have already begun to actively engage with these ongoing demographic changes. if, as a result of such efforts, the dynamism of japan's economy is fully exploited, i think it entirely feasible that the potential of the economy will be enhanced even in the face of a declining labor force. vi. conduct of monetary policy in closing, let me touch upon the bank's conduct of monetary policy. the bank's monetary policy is aimed at contributing to the balanced and sustainable growth of japan's economy through the pursuit of long - run price stability. as for the conduct of monetary policy in the near future, the bank will aim to achieve its stated goal by maintaining the framework of the quantitative easing policy based on the clear commitment in terms of the cpi. with the economic recovery likely to remain highly sustainable and the year - on - year changes in the cpi expected to remain positive, the possibility of a departure from the unprecedented framework of the quantitative easing policy, which was introduced to stave off a deflationary spiral, is likely to increase over the course of fiscal 2006. in making this decision, the bank will judge whether the policy commitment has effectively been fulfilled, that is, whether the year - on - year rate of change in the cpi is registering zero percent or higher on a sustainable basis, by monitoring developments in economic activity and prices. since, at present, the effects of the quantitative easing policy are increasingly coinciding with the effects of short - term interest rates being at practically zero percent, a change of the policy framework does not in itself imply any major change in policy effects. such a change is likely to encourage smoother formation of the yield curve in financial markets, thereby invigorating the economy. although the level of interest rates after such a change of policy framework will of course depend on developments in economic activity and prices, an accommodative financial environment is likely to be maintained, as long as upward pressure on prices continues to be contained and the economy follows a sustainable and balanced growth path. conclusion japan's economy is now entering a robust recovery phase, having gone through

seppo honkapohja : brief remarks of finnish financial history welcome remarks by mr seppo honkapohja, deputy governor of the bank of finland, at the dinner for the suerf conference, helsinki, 14 september 2017. * * * speakers, organizers and participants of the 33rd suerf colloquium, it is my pleasure to welcome you to the dinner. shadow banking, the theme of the conference is of course highly topical and is also a central concern for financial regulation. i will not try to comment on the conference theme but instead thought to tell you a little bit of finnish financial history in my short welcoming remarks. finland has not experienced any major problems in banking or financial markets during the recent global financial crisis. finland did, however, go through a major financial crisis in the early 1990 ’ s. in fact, the finnish crisis was one of the big five in the table of 18 financial crises in advanced economies in the period from wwi to 2007 ( i. e. before the current global crisis ) developed by ken rogoff and carmen reinhard in 2008. 1 incidentally, both norway and sweden are also among big five. the finnish crisis was a boom - bust cycle, which was to large extent caused by problems in the deregulation of the financial system in the 1980s. before the deregulation, the finnish financial system was tightly controlled with interest rates mostly set by the central bank and controls of external capital movements. financial deregulation led to a huge credit expansion and large inflows of capital. the growth rate in bank lending reached to about 45 % at the end of 1980 ’ s2. the boom period came to an end in 1990 when a rapid decent in real activity ensued. this development led to a major banking crisis which stared in september 1991. large amounts of public funds and some other forms of support had to be employed to counter the crisis. major restructuring of the banking system was carried out to improve the efficiency of the banking system. the banking crisis came to its end in 1996 – 7 when the banks began to show positive profits, though structural changes in the banking system continued much longer. this is in brief the story of the finnish financial crisis in the 1990 ’ s. i should note that shadow banks did not have any major role in the finnish financial system in 1980s and in the financial crisis. however, we saw a little bit of the shadow bank phenomenon in what was called “ grey economy ” and “ grey financial