More needs to be done to combat the banking sector's "too big to fail" problem, which still poses a risk to global finance and the economy, a report by the Financial Stability Board (FSB) said on Monday.
Further legislation, regulation and international cooperation is necessary to address the moral hazard posed by banks or other institutions that are so big they cannot fail without damaging the broader financial sector or the economy, the Switzerland-based FSB said.
In a report published ahead of the G-20 summit on September 5 and 6, the FSB recognized that some progress had been made in addressing the issue – in particular, by boosting banks' capital requirements and strengthening their infrastructure. But the body, which was established to co-ordinate a regulatory response to the world's worst financial crisis since the Great Depression, stressed "the job is not finished."
(Read more: What the G20 Need to Talk About This Week)