CHICAGO -- Financial market turmoil underscores the need for "generous" capital cushions, and banks need to actively raise money as needed, U.S. Federal Reserve Chairman Ben Bernanke said Thursday.

"I strongly urge financial institutions to remain proactive in their capital-raising efforts," Bernanke said in prepared remarks at a conference on bank structure and competition in Chicago.

"Doing so not only helps the broader economy but positions firms to take advantage of new profit opportunities as conditions in the financial markets and the economy improve," Bernanke said.

Bernanke said regulators were also pushing for better disclosure by banking institutions to increase transparency and to strengthen market discipline, and blamed lax risk management practices at financial firms for contributing to credit turmoil.

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