Federal Reserve Chairman Ben Bernanke said today that even though the economy has started to improve, that doesn't lessen the need for comprehensive regulatory reform, especially with regard to large financial institutions.

"We cannot lose sight of the need to reorient our supervisory approach and to strengthen our regulatory and legal framework to help prevent a recurrence of the events of the past two years," he said at a conference of the Federal Reserve of Boston in Chatham, Massachusetts. ""Legislative action is needed to create new mechanisms for oversight of the financial system as a whole."

He hasn't taken a position on the proposed Consumer Financial Protection Agency but in his speech defended his agency's record on consumer protection, which has been criticized by some lawmakers.