ANKARA
The U.S. Federal Reserve and other regulators have made "significant progress" in addressing the flaws of the global financial system, U.S. Federal Reserve Chairwoman Janet Yellen said Wednesday.
But Yellen did not speak about current U.S. economic conditions or the prospect of an interest rate hike.
Speaking in Washington at an International Monetary Fund conference, the Fed chief discussed issues in the financial system that triggered the financial crisis of 2008.
Yellen said that the Fed and other regulators were taking steps to make sure that the collapse of even very large banking institutions can be handled in ways that did not jeopardize the stability of the entire system. The worst of the financial crisis of 2008 came after the collapse of the giant investment bank Lehman Bros., and after it, global insurance firm American International Group.
Yellen added that banking regulators would remain "watchful" for any areas where further reforms might be needed.
"A well-functioning financial sector promotes job creation, innovation, and inclusive economic growth," Yellen said. "But when the incentives facing financial firms are distorted, these firms may act in ways that can harm society. Appropriate regulation, coupled with vigilant supervision, is essential to address these issues,” she said.
