their construction as well as implementation. while these approaches are still untested, this exercise will make an important contribution to deepen our understanding on the relevance of business models and the different regulatory structures and legal systems that have an important bearing on the operations of significant institutions with cross border operations. bis central bankers ’ speeches moving forward, more experience is still to be gained in regard to effective financial stability communication strategy, an element that has not received much attention until the recent crisis. credible financial stability communication strategies, particularly during periods of heightened uncertainties will require appropriate timing and delivery as well as effective coordination among relevant agencies. the effective coordination of announcements on the blanket government guarantee and liquidity measures in malaysia, singapore and hong kong during the recent crisis for instance, had helped sustained the overall confidence in our financial markets. similarly, there are also lessons to be learned in regard to the experience in the communication of supervisory stress test results in europe and the united states. conclusion given the dynamics of the financial markets today, more effective engagements between policy makers and the industry, both within and across borders have never been more important so as to bring about a greater awareness of key financial stability issues, to further sharpen supervisory and management judgements and to promote greater collaboration on multiple fronts. enhanced prospects for greater global financial stability depend on a sustained commitment to these priorities. ultimately, the goal is to strengthen our collective ability to anticipate and respond effectively to developments that affect financial stability, not just in these present challenging times, but through what will likely be an extended period of global adjustments going forward. bis central bankers ’ speeches

called bifurcated approach. the advance proposal suggested three possible ways to structure a capital standard for non - complex banking organizations. the first option would combine a risk - based ratio with a leverage ratio. this option would retain much of the current approach while tailoring capital charges to the size, structure, and risk profile of less - complex banking organizations. the second option would use only a leverage ratio. taking an approach not unlike the primary capital standard we used throughout the 1980s, it would drop any semblance of a risk - weighted measure and base a bank's capital requirements only on the ratio of its capital to total assets. the third alternative is simply a modified leverage ratio that would add the exposures arising from loan commitments and other offbalance - sheet transactions to total bank assets. reflecting its early stage of development, the proposal presents more questions than answers and does not flesh out any of the three alternatives it presents. one important question relates to how noncomplex institutions would be defined. the proposal suggests basing the decision on a bank's asset size, the nature of its activities, and its risk profile - - for example, assets less than $ 5 billion, moderate amounts of off - balance - sheet transactions that are mostly loan commitments, and a focus on traditional banking activities. in effect, the size threshold would be the determining factor for most banks, permitting all but a few hundred of the nearly 9, 000 federally insured commercial and savings banks to calculate their capital requirements using a simple approach. almost all thrifts as well would likely qualify for the simpler approach. this seems to be the proper time to consider a simpler approach for community banks as we undertake major revisions to the basel accord. however, to be consistent with the spirit of basel, the agencies proposed that a simpler system should also be more conservative, requiring at least a slightly higher minimum capital charge. such a higher minimum would still, however, be below the actual ( or economic ) capital now maintained by virtually all community banks. the higher capital ratios now maintained at smaller banks reflect certain economic realities. these banks generally carry greater risk than larger banks because of their greater concentrations in exposures and funding sources, byproducts of their limited geographic scope and scale. in addition, because of their more limited access to capital markets, community banks have fewer options for augmenting capital when it is needed. the higher capital ratios at community banks, compensating for these greater risks, result as much from bank