This means that financial institutions play the extremely important role of gauging borrower firms’ future profitability and growth potential and of making loan decisions and setting loan conditions. It is therefore strongly hoped that financial institutions hone their ability to identify firms with growth potential and thereby contribute to the growth of Japan’s economy.
At the same time, in order for financial institutions to make such a contribution, it is important that the role of financial intermediation is properly appreciated also in Japan. The role of policy makers Now let me talk about the role policy makers play in innovation.