to internalize the costs that their potential failure would impose on the broader financial system and thus on businesses and households. this means that firms face higher costs through more stringent regulations as they grow in complexity, size, and interconnectedness. and rightly, that community banks face simpler regulations. we are looking holistically at our capital tools to understand how they are supporting the resilience of the financial system, individually and in combination. when calibrating requirements, we will work to minimize unintended consequences, limit opportunities for gaming, and avoid excess compliance costs that do not result in risk reduction. taking a holistic view will help us consider adjustments, if any, to the supplementary leverage ratio, needs, in concert with a greatly improved regulatory framework for capital that more accurately assesses risks to individual institutions in a complex, dynamic, and interconnected financial system. - 4countercyclical capital buffer, and stress testing. within this context, i am also committed to implementing enhanced regulatory capital requirements that align with the final set of “ basel iii ” standards or the so - called the “ basel endgame. ” this process will involve working with other federal banking agencies and soliciting public input, and i ’ ll have more to say about this later this fall. resolution sufficient capital in the financial system helps support the resiliency of individual banks, but it is still important to ensure that, if a large firm gets into trouble, it can be resolved without a costly bailout. the dodd - frank act established the framework necessary to end bank bailouts. it provides the federal deposit insurance corporation ( fdic ) with the authority to resolve any firm whose failure would pose substantial risks to our financial system, in a way that will protect the economy while ensuring that large financial firms — not taxpayers — bear any costs. in addition, the fed and fdic require large banks to develop living wills to demonstrate that they can be resolved in an orderly way. many gains have been made from this process. while recognizing these gains, we need to continue to analyze whether firms are taking all appropriate steps to limit the costs to society of their potential failure. as such, we will continue to work with the fdic to rigorously review firms ’ plans, making clear when firms do not meet our expectations and when remediation is necessary. in addition, beyond globally systemically important banks, or g - sibs, we will be looking at the resolvability of some

, soundness, and financial stability. tiered regulatory and supervisory experience the federal reserve also takes a tiered approach to supervision. we organize the firms we supervise into portfolios based predominately, although not exclusively, on asset size. we have four such groups : ( 1 ) community banking organizations, which are generally those with $ 10 billion or less in total assets ; ( 2 ) regional banking organizations, which have total assets between $ 10 billion and $ 50 billion ; ( 3 ) large banking organizations, which have total assets over $ 50 billion but are not among the largest and most complex banking organizations ; and ( 4 ) firms overseen by the large institution supervision coordinating committee ( liscc ), which are the largest and most complex banking organizations. 1 as with tiered regulation, our tiered supervision is intended to take into account differences in business models, risks, relative regulatory burdens, and other salient considerations. where specific regulatory goals for the different portfolios vary, the supervisory programs reflect those differences. and even where the goals are similar across portfolios, supervisory programs should nevertheless take account of the differences among the firms in the four portfolios. in general, we shape our supervisory expectations for each portfolio by considering the increase in safety and soundness that we are likely to achieve through a specific practice or requirement, in light of the regulatory costs for the banking organizations in the portfolio and the impact that the stress or failure of those institutions would likely have on credit intermediation, the deposit insurance fund, and financial stability. so, for example, there are heightened expectations with regard to corporate governance for large banking organizations that are not applied to regional or community banking organizations. among other areas, the federal reserve expects the boards of directors of these larger firms to set direction and oversight for revenue and profit generation, risk management, and control functions ; to ensure that senior management has the expertise and level of involvement required to manage core business lines, critical operations, banking offices, and other material entities ; and to maintain a corporate culture that emphasizes the importance of compliance with laws, regulation, and consumer protection. while strong corporate governance is important at all banking organizations, it is vital at large banking organizations, given that their systems and operations are typically much broader and more for more information supervision. htm. on the liscc, see http : / / federalreserve. gov / bankinforeg / large - institution - bis central bankers ’ speeches complex than those of the smaller