April 11, Reuters

RICHMOND, Virginia - Overseers of the U.S. and international financial system need to quickly put reforms in place to restore confidence in markets disrupted by a global credit crisis, Federal Reserve Chairman Ben Bernanke said on Thursday.

The current market unrest complicates the process of making changes aimed at erecting a firewall against future crises, Bernanke told the World Affairs Council, but swift action could soothe jittery financial markets.

"We do not have the luxury of waiting for markets to stabilize before we think about the future," he said. "Indeed, many of the necessary changes that have been identified -- including increasing transparency, improving risk management, and attaining better coordination among regulators -- could provide important support to the process of normalizing our financial markets," he said.

Bernanke spoke as finance ministers and central bank heads of the Group of Seven rich nations gathered for a Friday meeting in Washington, where they are expected to endorse steps to respond to a global crisis that was spurred by rising U.S. mortgage defaults.

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photo: Federal Reserve Chairman Ben Bernanke testifies during a hearing on the response by federal financial regulators to ongoing turmoil in credit and mortgage markets and the near collapse of brokerage firm Bear Stearns, on Capitol Hill in Washington, April 3, 2008 (REUTERS/Jonathan Ernst)