applied policy finance, development finance, and other supportive measures. so far, there are over 750 financial institutions ( 40 % of which are in latin america ) working for the sole purpose of developing backward regions. almost every african country has set up a bank for regional development. to support disadvantaged groups, over 150 countries have pension insurance institutions, and half of all the countries in the world have established policy medical insurance institutions. furthermore, many countries have student loan schemes in various forms, which have played an important role in promoting economic development and social stability. second, a legal system governing finance for the disadvantaged. most countries regulate financial institutions through a fully - fledged legal framework, and strictly separate financial legislations and regulations into those regulating commercial finance and those targeting policy and cooperative finance, so that the latter group of financial institutions has their own laws and are free from intervention. thus, they are able to serve agriculture, rural areas, disadvantaged industrial sectors and groups better. many countries have promulgated special laws to emphasize the importance of the finance for the disadvantaged, such as federal agricultural loan act, agricultural credit union act, and community investment statute in the us, law on japanese development banks, law on japan scholarship society in japan, kfw - gesetz ( law on kfw development bank ) in germany, law on korean development bank, law on long - term credit bank of korea in south korea, act on agricultural intermediary credit and development companies in india, etc. these laws are gradually improved to support and safeguard the development of financial institutions for disadvantaged regions, industrial sectors and groups. third, a system of supportive policies. investment in less - developed regions disadvantaged industrial sectors and disadvantaged groups has lower efficiency, diminishing returns, and high risks ; therefore, it is very unlikely to secure capital investment if completely market - oriented. as such, a lot of countries provide preferential policies, such as capital infusion in development financial institutions, guarantee, tax holiday, interest subsidy, etc. for example, the german government guarantees all the liabilities of kfw incurred in supporting the development of disadvantaged industrial sectors and regions, grants it special treatments such as tax exemption and zero dividend payout to shareholders, and allows all profits to be used to increase capital. japan development bank is exempted from all local tax, state tax and corporate tax. the korean government guarantees the principal and interest payment of financial bonds issued by korean development bank ’ s to support development of disadvantaged industries. the

directors and senior executives of banks. in giving consent, we recognised that, under certain circumstances, all our large banks being australian - owned could increase our system ’ s exposure to stress emanating from the australian economy and financial system. we will be considering this further and have let it be known that we will take further measures to manage this risk if necessary. as noted before, the conditions imposed on the anz ’ s acquisition are a specific application of our current policy thinking around governance and crisis management, coloured by the additional considerations introduced by the rbnz amendment act. this thinking is still developing, and relevant to all systemically important banks. generic policies regarding these matters will be fleshed out as part of our broader financial stability work programme, and we will be consulting with banks on those generic policies in due course.