In essence, we worry not only about prospects of external shocks (the equivalent of weather or crop prices), but also about the buffers that our banks, businesses, and households have (the equivalent of the financial reserves farmers need to carry in case the harvest disappoints).
VI. Concluding Remarks Thus far, my discussion has focused on the role of financial institutions in times of disaster, while looking back on their response to the Great East Japan Earthquake. In times of disaster, it is critical that financial institutions ensure cash circulation and maintain their payment and settlement functions as social infrastructure underpinning financial and economic activities.