Writing in the Daily Telegraph, Turner said the response to the 2008 crisis by regulators and central banks, led by the Financial Stability Board (FSB), has made progress but is unfinished.

He said the original crisis was not a traditional banking crisis, but linked to a “new phenomenon – shadow banking”.

Turner explained the early signs of stress arose in hedge funds, then banks’ off-balance sheet vehicles ‘structured invested vehicles’. He said Bear Stearns and Lehman Brothers were “not banks, but broker-dealers” and AIG was an insurance company.

Turner told the paper: “In summer 2008, money market funds were under stress, and in autumn 2008 the financial system suffered a new form of ‘liquidity run’ concentrated as much in secured lending markets, such as repo, as in unsecured deposits.

“Our regulatory response must therefore cover ‘shadow banking’ as well as banks. The FSB has committed to delivering a reform package by the end of this year. That is being developed by the FSB’s Committee on Supervisory and Regulatory Co-operation, which I chair.”

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He said it was a huge challenge due to the “sheer complexity of shadow banking activities”.