SMFG Capital Ratio Information B. Verification of Scenarios Using Three Data Elements  (A) Reassessment of Scenarios Using Internal Loss Data (B) Reassessment of Scenarios Using External Loss Data (C) Reassessment of Scenarios Using BEICFs At SMFG and SMBC, we compile data related to changes in laws and regulations, changes in internal rules, policies and procedures,  and new business, products and process, all of which are business environment and internal control factors (BEICFs). We use this  information to consider periodically whether our scenarios should be reconsidered, and, even for events other than those listed  previously, when major changes occur in the business environment, our systems provide, as necessary, for the consideration of  whether scenarios should be revised. When we decide it is necessary for the scenario to be reviewed, we make a reassessment based on the information related to  changes and other factors in BEICFs. In this process, we consider redeveloping and reassessing the scenario and other related matters  to ensure that the changes in BEICFs are properly reflected in our scenarios. When we decide it is necessary for the scenario to be reviewed, we make a reassessment based on the external loss data. In this  process, we consider deriving and reassessing the scenario and other related matters to ensure that the external loss data is properly  reflected in the scenario. From this database, we draw external loss data which fulfill the established criteria, and the content of the related loss events is  considered; then, a judgment is made regarding whether or not to revise the scenario in question. Specifically, we pose a number  of issues to consider, such as whether the scenarios in question exist at SMBC, and, if so, whether the deviation between the actual  loss and the assessed value of the scenario is within the tolerance range. In considering these issues, we follow a set pattern of logical  reasoning in making a decision on whether the scenario should be reviewed. At SMFG and SMBC, we have a database containing more than 7,000 cases of external losses that have been taken from the mass  media, including newspapers, and purchased from data vendors. A framework has been created to enable the sharing of this database  across the Group. When we decide it is necessary to revise the scenario, we make a reassessment based on the internal loss data. In this process, we  consider redeveloping and reassessing the scenario and other related matters to ensure that the internal loss data is properly reflected  in the scenario. Both SMFG and SMBC, in principle, compile internal loss data on all gross loss amounts of at least one yen. From the data, internal  loss data which fulfill the established criteria are drawn, and the content of the related loss events is considered; then, a judgment  is made regarding whether or not to review the scenario in question. Specifically, we pose a number of issues to consider, such as  whether the scenario exists at SMBC, and, if so, whether the deviation between the actual loss and the assessed value of the scenario  is within the tolerance range. In considering these issues, we follow a set pattern of logical reasoning in making a decision on  whether the scenario should be revised.  At SMFG and SMBC, the verifications of the assessments of scenarios using internal loss data, external loss data, and BEICFs  (hereinafter, “3 data elements”) are implemented periodically. Specifically, SMFG and SMBC use these data and information and use  them to determine, periodically, whether there are any scenarios that have been omitted and whether the assessments of the scenarios  are appropriate to ensure the completeness and appropriateness of the scenarios.  SMFG  2011 204