tlac ) chart 2 capital adequacy of financial institutions in major countries japan europe united states % % % % fy08 09 10 11 cy08 09 cy08 09 tier 1 capital ratio fy08 common equity tier 1 capital ratio notes : 1. figures for japan are weighted averages of internationally active banks. 2. figures for the united states are simple averages of five u. s. banks ( bank of america merrill lynch, citi, goldman sachs, j. p. morgan, and morgan stanley ). 3. figures for europe are simple averages of six european banks ( barclays, bnp paribas, credit suisse, deutsche bank, hsbc, and ubs ). sources : bank of japan ; bloomberg. chart 3 macroprudential policy macroprudential policy tools [UNK] countercyclical capital buffer ( ccyb ) [UNK] loan - to - value ( ltv ) regulation, etc. institutional frameworks for the implementation of macroprudential policy [UNK] establishment of interagency committees in jurisdictions with multiple regulatory and supervisory authorities, etc. [UNK] creation of the " council for cooperation on financial stability " in japan chart 4 a new horizon for the " lender of last resort " function the traditional " lender of last resort " function [UNK] responding to the risk of the deteriorating health of one financial institution tainting other financial institutions through inferences made by depositors, etc. " market maker of last resort " function [UNK] responding to the contraction of market activities resulting from concerns over counterparty risk among market participants " global lender of last resort " function [UNK] responding to foreign currency liquidity shortages faced by globally active financial institutions chart 5 core profitability of japanese financial institutions lending margins operating profits from core business major banks 3. 0 % major banks regional banks shinkin banks 2. 5 tril. yen second half of the fiscal year shinkin banks regional banks tril. yen tril. yen 2. 5 1. 0 2. 0 0. 8 1. 5 0. 6 1. 0 0. 4 0. 5 0. 2 0. 0 0. 0 0. 0 fy89 91 93 95 97 99 01 03 05 07 09 11 13 15 fy89 91 93 95 97 99 01 03 05 07 09 11 13 15 4. 5 4. 0 first half of the fiscal year 3. 5 3. 0 2. 0 2. 5 2. 0 1. 5 1.

inappropriate. since the introduction of qqe, the bank has been consistently pursuing powerful monetary easing both in terms of quantity and interest rates, and there is no change in its stance. the bank will continue with powerful monetary easing under " qqe with yield curve control, " aiming to achieve the price stability target of 2 percent at the earliest possible time. taking account of developments in economic activity and prices as well as financial conditions, it will take additional easing measures without hesitation if judged necessary to maintain the momentum toward achieving the 2 percent target. concluding remarks in conclusion, let me touch on the economy of nagasaki prefecture. tracing its history, the prefecture has functioned for a long time as a foothold for cultural interaction between many countries, as evidenced by the history of dejima, and thus represents a variegated history and culture. the prefecture takes advantage of the tradition of manufacturing, particularly of heavy industry including shipbuilding, and distinguished skill and technique. it also is endowed with tourist attractions including islands, hot springs, and fresh agricultural and fishery products, as well as a fascinating food culture. the shipbuilding industry, which is the key industry of the prefecture, is facing a severe environment surrounding orders, brought about by chronic excess of vessels globally and by sluggishness in the shipping market. there seems to be no influence on business operations for the time being as there is a backlog of orders for the upcoming three years or so, but i have heard that the local companies, including those engaged in shipbuilding, have started to take actions so as to change their business operations. in terms of tourism, the effects of the kumamoto earthquake have waned from summer, and i have heard that the number of visitors to major tourist facilities have picked up. moreover, efforts have been made steadily toward future developments of the prefecture, such as the proposal of " churches and christian sites in nagasaki " for inscription on the unesco world heritage list, nagasaki city being chosen as a " tourism nation showcase " by the japan tourism agency, and initiatives to establish destination management / marketing organizations for sightseeing. on the financial front, changes in the business environment - - such as consideration on integrating regional financial institutions - - have emerged under the idea to contribute to stimulating the region and vitalizing the local economy amid the situation of a declining and aging population. as for economic and financial communities of nagasaki prefecture, i believe that forthcoming changes must be addressed appropriately and strategically while gaining a strong footing. the bank anticipates