Financial regulators should be prepared to 'wipe the slate clean as they search for a more effective global regime in the wake of the credit crisis, the chairman of Britain’s financial watchdog has said.

Lord Turner of Ecchinswell, who took over as chairman of the Financial Services Authority last month, said regulators should be prepared to engage in a fundamental debate about how to set banks’ minimum capital requirements following state banking bail-outs in Europe and the US.

'When you’ve been through a crisis like this, it’s rather sensible to wipe the slate clean in terms of all your previous assumptions,' he said in an interview with the Financial Times.

Lord Turner also warned banks and insurance companies regulated by the FSA they would have to pay higher fees so the regulator could strengthen its supervision of institutions that pose a potential risk to the stability of the financial system.

Financial Times