(Reuters) - The financial system is safer than it was five years ago as banks have more capacity to withstand shocks, but more needs to be done to reduce risk, particularly in derivatives.
A poll of bankers, lawmakers, regulators and others attending the World Economic Forum in Davos, Switzerland showed 61.7 percent believed the financial system was safer than five years ago, while 38.3 percent said it had not improved.
"Markets are safer, and quite markedly so," Douglas Flint, chairman of Europe's biggest bank HSBC
"It would be a shocking indictment of the industry, regulators and public policymakers if six years after a dramatic crisis efforts hadn't been successful to make the system safer," Flint said.
Others disagreed, however.
"I don't believe the financial system and markets are safer and I don't believe they are safe," Paul Singer, founder and CEO of New York-based hedge fund Elliott Management, said.
"The leverage in the system, especially in derivatives, has not been meaningfully reduced, and the opacity of derivatives and other complicated securities has not been changed at all."
Complex derivatives have been blamed for playing a big part in the financial crisis and regulators have tried to improve transparency in these products.
Singer said countries that were the last line of support in 2008 now had less capacity to help the industry, while many financial firms still did not understand their risks.
But Flint and Antony Jenkins, chief executive of Barclays
Management were spending a majority of their time on these issues, and HSBC's board spent between two-thirds and three-quarters of its time on regulation, oversight and dealing with legacy issues, Flint said.
"It's very difficult to argue that the financial system is not safer than it was in 2008, but the question is how much safer is it," Barclays' Jenkins said.
"We still have a significant amount of work to conclude the implementation of all of the regulatory changes, and this will not happen until close to the end of this decade," he said.
(Writing by Steve Slater. Editing by Jane Merriman)