Years of regulatory reform in the wake of the financial crisis have yet to deliver a safer global financial structure, according to the International Monetary Fund.The IMF issued an assessment of financial system reform this week, concluding that the reforms are aimed in the right direction but "financial systems remain vulnerable".The reforms have been designed to make markets and institutions more transparent and less complex and less leveraged.However, the IMF's view is that: "The reforms have yet to effect a safer set of financial structures because, in part, in some economies the intervention measures needed to deal with the prolonged crisis are delaying a 'reboot' of the system onto a safer path."The IMF report, Global Financial Stability Report, said the structure of intermediation remained largely unchanged. "Financial systems are still overly complex, banking assets are concentrated, with strong domestic interbank linkages and the too-important-to-fail issue is unresolved."The data suggest that systemic risks arising from the size and scope of intermediation remain much as before, with linkages across institutions in domestic financial systems still high and financial innovation and complex products taking on new forms. Innovative products are already being developed to circumvent new regulations."Banks are securitising counterparty credit risk and attempting to raise profitability with more emphasis on non-interest related activities. "Some advanced economy financial institutions continue to rely heavily on wholesale funding. Funding vulnerabilities remain."The report warned that in the absence of appropriate policies, highly integrated economies are still susceptible to harmful cross-border spill over."Despite much progress on the reform agenda, reforms in some areas still need to be further refined by policymakers. These areas include a global-level discussion on the pros and cons for direct restrictions on business models, prudential standards for non-bank financial institutions posing systemic risks within the shadow banking sector and further progress on recovery and resolution planning for large institutions."The report said the implementation of reforms was uneven. In some economies the continued need for official support of the financial system is not accompanied by resolute measures to restructure the system."There is a risk that in some markets large institutions will become larger still, and more concentrated, and that these few global institutions will become even more influential - thereby further entrenching the too-important-to-fail problem."And the IMF cautioned that recent regulatory reforms are not the only influences on the future financial structure. Central banks have taken on a more prominent role in the financial sector, as is evident by their significantly larger balance sheet sizes. "To a large extent, their operations have substituted for interbank lending (especially in the euro economies and Japan)."Under current conditions such monetary policy initiatives are necessary but they remove some of the pressure to alter funding structures.  If the central bank initiatives are not accompanied by resolute action to restructure the impaired segments of the financial system they may inhibit adjustments in the structure of the banking system."