We fully recognize the importance of stabilizing public expectations about future policy directions, and we will make further efforts to enhance transparency regarding the conduct of monetary policy. 3. Promoting financial system stability  The second contribution of the Bank is to secure financial system stability by urging financial institutions to enhance their soundness.
For the past ten years, the financial system problem in Japan has been almost synonymous with the nonperforming-loan (NPL) problem. However, it goes without saying that what is really important is for financial institutions to overcome the NPL problem and transform themselves into a new financial service industry equipped with renewed competitiveness.