Washington - Federal Reserve chief Ben Bernanke began a second term on Wednesday calling for the central bank to retain its independence and urging reforms to ensure a major financial crisis "never again" occurs.
Bernanke took the oath of office for a new four-year term as chairperson of the Board of Governors of the Federal Reserve System after a bruising confirmation battle that ended with a 70-30 Senate vote last week approving his nomination.
The swearing-in was administered by Fed vice chairperson Donald Kohn and attended by Anna Bernanke, the chairperson's wife, in the atrium of the central bank's main building in Washington.
In his remarks, Bernanke said the central bank must work with Congress and others to reform the financial system to avert a recurrence of the worst economic crisis in decades.
"We will continue to work with the Congress to develop an effective, comprehensive reform of financial regulation," he said. "As we move forward, we must continue to do all that can be done to ensure that our economy is never again devastated by a financial collapse."
Bernanke also cautioned against reforms that would weaken the central bank's independence.
"The Federal Reserve has been granted, both in law and in political tradition, considerable independence and autonomy," he stated.
Economic growth 'encouraging'
"In the interest of maintaining public confidence and promoting economic and financial stability, we must continue to protect our independence."
Bernanke said he begins his second term "with considerable gratitude and not a little humility" and thanked President Barack Obama for renominating him.
"The past four years have been an extraordinary time," said Bernanke, 56, a former Princeton University professor and scholar of the Great Depression who started the job as chairperson on February 1, 2006.
"In many respects, this period has shown this institution at its finest, as we moved rapidly, forcefully, and creatively to confront the deepest financial crisis since the Great Depression and help prevent a looming economic collapse."
Bernanke said the resumption of growth after the deepest recession in decades was "encouraging" but that "far too many people remain unemployed, foreclosures continue at record rates, and bank credit continues to contract."
He argued that "we must continue to do all that we can to ensure that our policies are helping to guide the country's return to prosperity in an environment of price stability."
Need to be more transparent
The crisis "revealed weaknesses and gaps in the regulation and supervision of financial institutions and financial markets" that the Fed would work to address with other partners in government, Bernanke said.
Addressing criticism about the Fed's secrecy, Bernanke said the Fed "is already one of the most transparent and accountable central banks in the world," but that "we should be prepared to do even more, to become even more transparent."
Bernanke, who was named 2009 "Person of the Year" by Time magazine, won confirmation despite fierce attacks on his role before the crisis that resulted in a near-meltdown of the global financial system.
Opposition to Bernanke - who drew a historic number of "no" votes - had led Obama and top aides to work the phones to court wavering senators gripped by election-year populist pressures fuelled by the battered US economy.
His supporters said Bernanke had pulled the world's richest economy back from the brink of a collapse like the Great Depression of the 1930s - though many also noted he had not done enough to prevent the crisis.
While Bernanke easily got the 51 votes needed for confirmation, he drew far more "no" votes than any other US Fed chief in history.
- AFP