that must be dealt with soon to avoid a new type of crisis. this is one of the compelling reasons that we are putting a very high priority on “ development ” issues at the upcoming g20 meeting in seoul. what then should be the role of central bankers in preventing and managing future financial crises? with the limited policy instruments available, central bankers should establish closer networking among themselves for active information sharing to cope with the ever - increasing cross - border transmission of domestic policy actions. i think there is much more that the tripartite governors ’ meeting and our three central banks should be doing together in the future than they have in the past. for heightened prosperity and stability, let us go forward together hand in hand. in this way, i believe, our three countries can also contribute immensely to the global economy. thank you for listening.

##bs ) and other setters of international standards are leading this discussion, major central banks around the world have taken an active part in it. in contrast to the past, the present debate on financial reform is taking place within a framework of close international cooperation under the aegis of the g20, and also the scope of financial reform is becoming wider and more embracing. we may say that there are four items on the agenda for financial reform now under discussion. firstly the basel committee on bank supervision is leading the discussion on the strengthening of banks ’ capital and liquidity regulations. the background to this is the criticism that, as the recent financial crisis unfolded, the existing scheme of capital regulation under basel ii was simply not up to its function as a tool for crisis prevention. let me give you an example. even banks with satisfactory capital adequacy ratios under basel ii became distressed. the expansion of excessive leveraging served as a factor in ramping up financial system instability. secondly, in addition to strengthening the existing micro prudential regulations, this item on the agenda sets out to construct a framework of macro prudential regulation to deal with systemic risks. spurred on by the financial crisis, the importance of macro prudential policy has come to be emphasized as the missing pillar within the existing edifice of financial stability. to put it another way, macro prudential policy for the management of overall risk within the financial system is needed because the micro prudential soundness of individual financial institutions alone cannot guarantee the stability of the financial system as a whole. among macro prudential regulations, the main focus is directed to those targeting systemically important financial institutions ( sifis ). in line with the question of being “ too big to fail ” that arises in the case of systemically important financial institutions, this proposal needs to be pursued to avoid financial system stability being put at risk by moral hazard. third on the agenda is enlarging the objects of regulation from financial institutions alone. this involves strengthening the regulation of over - the - counter derivatives markets and hedge funds, whose riskiness was highlighted by the latest financial crisis, and also that of credit rating agencies. the last item on the agenda is to build a global financial safety net ( gfsn ), which is part of the “ korea initiative ” as it was put forward by korea. the financial crisis that erupted in the united states and other advanced countries inflicted serious damage on a number of countries for no - fault of their own