are standards that apply throughout the financial system. we also recognize that, apart from changes in the regulatory and supervisory landscape, the banking industry itself has undergone major changes. for example, improvements in technology and changes in the financial industry ’ s composition between depository institutions and nondepository companies have altered the types of financial products and services that are offered by depository institutions, as well as how those services and products are accessed. we welcome your views on how these types of industry changes have impacted the effectiveness of our regulations. today i look forward to hearing your views on our agencies ’ regulations, especially in the categories of banking operations, capital, and the community reinvestment act ( cra ). for the federal reserve, these topics include regulations on the availability of funds ; the collection of checks and other items by the federal reserve banks and fund transfers through fedwire ; prompt corrective action procedures ; and the disclosure and reporting of cra - related agreements. bis central bankers ’ speeches i ’ d like to conclude by saying that we will consider your comments carefully as the agencies coordinate to discuss and consider the appropriate action that is likely to best serve our financial system and the interests of depository institutions and consumers. and when possible, the agencies will act to implement regulatory burden relief before the end of the egrpra review period. for example, in december of last year, congress passed legislation – which was supported by the federal reserve board – that would increase the consolidated asset limit for small bank holding companies from $ 500 million to $ 1 billion under the small bank holding company policy statement and that extends the same treatment to savings and loan holding companies of less than $ 1 billion. last thursday, the federal reserve issued for public comment both proposed and interim final rules for public comment that would implement that legislation. 1 the rules would reduce regulatory burden on small entities by excluding many bank holding companies and savings and loan holding companies with total consolidated assets of less than $ 1 billion from the consolidated capital requirements. of course, regulatory capital requirements will continue to apply to the depository institution level. the rules also would reduce the burden of regulatory reporting for these companies. the federal reserve currently estimates that the proposed revisions to the small bank holding company policy statement would impact over 4, 200 organizations. the final results of our egrpra review will be contained in the agencies ’ report to congress that summarizes the issues raised and the agencies ’ conclusions about the need for regulatory or legislative changes. thank you

##ity outflows resulting from public withdrawals of smaller below - market - rate insured deposits led first to an earnings squeeze and an associated loss of capital and then to a high risk investment strategy that led to failure after failure. depositors acquiring the new larger denomination insured deposits were aware of the plight of the thrifts but unconcerned about the risk because the principal amount of their $ 100, 000 deposits was fully insured by the united states government. in this way, the 1980 increase in the deposit insurance cap to $ 100, 000 exacerbated the fundamental thrift problem associated with concentration on long - term assets in a high and rising interest rate environment. indeed, it significantly increased the taxpayer cost of the bail out of the bankrupt thrift deposit insurance fund. not withstanding this problematic episode, it is clear that deposit insurance has played a key - - at times even critical - - role in achieving the stability in banking and financial markets that has characterized the past almost seventy years. deposit insurance, combined with other components of our banking safety net ( the federal reserve's discount window and payment system guarantees ) has meant that periods of financial stress are no longer characterized by depositor runs on banks and thrifts. quite the opposite : asset holders now seek out deposits - - both insured and uninsured - - as safe havens when they have strong doubts about other financial assets. looking beyond the contribution of deposit insurance to overall financial stability, we should not minimize the security it has brought to millions of households and small businesses. deposit insurance has provided a safe and secure place for those households and small businesses with relatively modest amounts of financial assets to hold their transaction and other balances. these benefits of deposit insurance, as significant as they are, have not come without cost. the very same process that has ended deposit runs has made insured depositors - - as in the 1980s with insolvent, risky thrifts - - largely indifferent to the risks taken by their depository institutions because their funds are not at risk if their institution is unable to meet its obligations. as a result, the market discipline to control risks that insured depositors would otherwise have imposed on banks and thrifts has been weakened. relieved of that discipline, banks and thrifts naturally feel less inhibited from taking on more risk than they would otherwise assume. no other type of private financial institution is able to attract funds from the public without regard to the risk it takes