UPDATE 1-ECB's Noyer warns on risk-taking by banks

SINGAPORE, Oct 26 - European Central Bank Governing Council member Christian Noyer warned on Monday that banks are taking risks that are reminiscent of the behaviour that caused the financial crisis.

His comments came as regulators around the world mull reforms to lower the risks that large banks can pose to the financial system and rein in the type of recklessness that fueled the credit crisis.

"There are signs that parts of the financial industry have resumed risk taking practices reminiscent of those which led to the crisis," Noyer said in a speech at a financial conference in Singapore.

"Most of the negative effects of the economic downturn on balance sheets yet to come."

Noyer said the global economy has stabilised, but added it was still necessary to sustain the momentum for reforming the financial system.

"One major risk in the period to come is the emergence of a business as usual mentality....it is clear to everyone that recent profits in the financial sector, while welcome, are for the most part a result of public policies implemented to combat the crisis," he said.