WASHINGTON - Though bankers appear to be improving credit quality and bank performance remains solid, "continuous vigilance" by bankers and regulators is necessary to guard against failures, Federal Reserve Chairman Alan Greenspan said Thursday.

In a wide-ranging speech delivered by satellite to a meeting of the National Association of Urban Bankers in San Francisco, Mr. Greenspan said that the Fed would continue exploring ways to develop a more tailored exam process that better responds to the needs of small- and medium-size banks.

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