The U.S. has made “significant progress” toward strengthening the financial system through reforms such has higher capital levels and stress tests for the nation’s largest banks, Federal Reserve Vice-Chair Stanley Fischer said Tuesday.

In his first public address since taking his post as second-in-command at the central bank, Fischer added that the problem of "too big to fail banks" is an issue that isn’t going away any time soon.

Fischer said reforms implemented since 2008 will go a long way toward “reducing the probability of future financial crises.”

“By raising capital and liquidity ratios for (big banks), and through the active use of stress tests, regulators and supervisors have strengthened bank holding companies and thus reduced the probability of future bank failures,” Fischer said in a speech in Cambridge, Mass.

In addition, other reforms included in the Dodd-Frank banking reform act passed by Congress in the wake of the 2008 crisis hold out the hope of ensuring a more orderly winding down of banks that get into financial trouble, reforms that should preclude -- or at least reduce -- the need for taxpayer funded bailouts.

“We should recognize that despite some imperfections, the Dodd-Frank Act is a major achievement,” he said.

“Resolution mechanisms” established in the Dodd-Frank bill could potentially “resolve banks in difficulty at no direct cost to the taxpayer -- and in any event at a lower cost than was hitherto possible,” Fischer said.

The vice-chair noted that establishing concrete “resolution mechanisms” remains a work in progress, unlike newly implemented requirements for capital levels and liquidity ratios that have been initiated industry-wide.

Fischer said “a great deal of progress” has been made in addressing the problem of too-big-too-fail banks.

“While we must continue to work toward ending (too big to fail) or the need for government financial intervention in crises, we should never allow ourselves the complacency to believe that we have put an end to (too big to fail),” he said.

Fischer all but promised there will be another financial crisis.

“At the same time, we need always be aware that the next crisis -- and there will be one -- will not be identical to the last one, and that we need to be vigilant in both trying to foresee it and seeking to prevent it,” he said.

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