of accounts receivable and goods in stocks of small firms in japan and also small relative to the outstanding balance in other advanced countries such as the united states. going forward, i expect this method to be utilized widely through active cooperation between financial institutions and firms. next i would like to introduce an attempt made mainly by regional financial institutions to send monozukuri or manufacturing instructors to small firms. “ competitiveness at worksites ”, or genbaryoku, of monozukuri proved effective in the process of rebuilding from the earthquake disaster. in order to boost the growth potential of japan ’ s economy by utilizing this strength, it is necessary to spread to other worksites the know - how of people who worked in the front - runner firms that lead the industry. also, it is important to pass on the advantages of genbaryoku to the next generation. with that in mind, some local governments and universities have been training as monozukuri instructors people in their 50 ’ s and 60 ’ s who have retired from manufacturing firms and sending those instructors to small firms to spread and pass on special techniques to others. in such a process, regional financial institutions play a major role. from the standpoint of small firms, some of them feel reluctant to accept instructors who have built up a long - term career in another firm. however, in cases bis central bankers ’ speeches where regional financial institutions match the right instructor and the right workplace using the trust between institutions and firms that they have been fostering every day, small firms tend to accept instructors much more easily. an example such as this has also been seen in shiga, kyoto ’ s neighboring prefecture. due to limited time, i have only touched upon two examples today. but i want to emphasize that, in either of the examples, not only industry, government, and academia but also financial institutions are collaborating and making efforts in their respective roles to boost the productivity and competitiveness of the region. i hope that such steady efforts, together with the accommodative financial environment, will support the enhancement of regions and industries, and consequently spread to japan ’ s economy as a whole. concluding remarks kyoto is a special place for me. i was born in tokyo, but during my childhood i often visited my uncle ’ s house in kamigamo, kyoto. he was chief librarian of the kyoto prefectural library at that time. the history and the culture that i saw and experienced at my visits have formed the basis of

have been making adjustments in the wake of the financial crisis to innovations such as stress testing, a public process that in my view has helped make financial oversight more effective. the thoughts that i am airing in these remarks, part of a public process of discussion and debate, should be seen as a continuation of the review and adjustment that has been taking place since the financial crisis. the goal is to simplify rules that have grown more complex in the past decade and in some cases redundant and harder to understand. my second goal, in considering these adjustments, is to maintain the high level of loss - absorbing capacity in the u. s. banking system. our financial system today is far more resilient than it was before the crisis and i want to maintain that resiliency. we are all better served by wellcapitalized banks that have the ability to continue lending to households and businesses even during stressful times. adjusting regulation in measured ways, such as those i will describe, is an appropriate and, in fact, necessary way to preserve the success we have achieved in strengthening the financial system. before i delve into describing the future direction of our stress testing and capital frameworks, allow me to begin with some background on the origins of the stress testing program and an 1 / 5 bis central bankers'speeches overview of the changes we have made to our capital requirements since the financial crisis. background on the fed ’ s stress testing program at the height of the crisis, as a way to help restore confidence in the largest u. s. banks, the fed created the supervisory capital assessment program ( scap ) to estimate potential losses at those banks, if economic and financial conditions worsened. building on the success of scap, the board moved to the current stress testing assessment, known as the comprehensive capital analysis and review ( ccar ), to evaluate whether the largest firms have sufficient capital to continue to lend and absorb potential losses under severely adverse conditions. at the same time that we were building our stress testing program, we were also making changes to capital rules to address weaknesses observed during the crisis. these included new minimum capital requirements and a capital buffer on top of these requirements. the buffer puts increasingly strict and automatic limits on capital distributions as a bank ’ s capital declines toward the minimum. large banks are also subject to a potential countercyclical capital buffer ( ccyb ), which i will discuss more shortly. and the largest banks are subject to an additional buffer of capital based on a measure