A separation of banks' deposit-taking and capital-market activities would seem unlikely to limit the too-big-to-fail problem to a significant degree, Daniel Tarullo, a governor at the Federal Reserve, has said.

Tarullo noted on Monday that some very large institutions have in the past encountered serious difficulties through risky lending alone. Moreover, as shown by Bear Stearns and Lehman Brothers, firms without commercial banking operations could now also pose a too-big-to-fail threat.

In