Even if policymakers reduce the size and scope of the largest banks, systemic risk is here to stay, former Federal Reserve Board chairman Paul Volcker said Thursday.

Mr. Volcker, whose comments came at a press conference to release a report recommending improvements in global financial regulation, clearly supported the efforts to shrink Citigroup Inc. but added that it is "impractical" to try to reduce large banks enough so they no longer pose a threat to the system.

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