Financial system and financial conditions after the earthquake Thanks mainly to these measures, functioning of financial and settlement systems has been maintained in Japan and stability has been ensured in the financial markets. As for the effects of the disaster on the financial system, as I mentioned earlier, a significant number of financial institutions’ branches have been physically damaged.
However, given that financial institutions have been striving to bolster their capital by raising additional capital and increasing internal reserves, and that financial institutions have not had any liquidity concerns thanks to the Bank’s ample liquidity provision, we believe that stability of Japan’s financial system is not threatened by the disaster.