Top regulators admit they made mistakes in the way they regulated the banking sector ahead of the worst financial crisis since the Great Depression of the 1930s.
Together with policy-makers they are now increasingly looking to work closely with governments and others to build a global financial architecture strong enough to absorb future shocks. "Regardless of how the financial crisis evolves, a new philosophy needs to evolve in respect with supervision," Swiss President Hans-Rudolf Merz, who is also the country's finance minister, told participants on Wednesday.
"Global rules need to be developed for the supervision and regulation of global players. Cross-border co-operation must be the norm," Merz, usually known for his pro-business, liberal stance, said.
Leaders from the Group of Twenty (G20) nations will discuss financial supervision at their upcoming meeting in April along with ways to improve markets regulation and review accounting and capital adequacy rules for banks.
The meeting will be the first major test in this field for the new administration of President Barack Obama.
Countries across the globe have acted in an uncoordinated fashion as they rushed to prop up banks caught up in the crisis and bankers said they would now welcome a quick regulatory response.
Jamie Dimon, CEO of JP Morgan Chase & Co, admitted bankers had done "some really stupid things" but he also hit out at policy makers and regulators, adding that the current Basel II rules on capital adequacy had flaws and needed to be changed.
"I haven't yet seen people get all the right people in a room, close the damn door and come out with a solution," he said on Thursday.
Adair Turner, Chairman of the UK Financial Services Authority, said he was already at work with other regulators to improve current capital rules so as to introduce a degree of counter-cyclicality, enabling them to build up capital during good years, which could then be used as a cushion during a downturn.
Turner said the new rules could involve the introduction of a leverage ratio for banks.
"Ideally that should be agreed internationally. That is going to be the biggest challenge for groups such as the Financial Stability Forum or the Basel Committee on Banking Supervision," Turner told Reuters on Wednesday.
In Europe, national interest has so far prevented any move towards cross-border supervision of banks, but the crisis showed there is a need for common oversight of the largest institution, according to European Internal Market Commissioner Charlie McCreevy.
"There is a need for a better way for dealing with the 45 institutions or so that operate cross-border," said McCreevy, a former free-marketeer who has warmed up to the idea of a single European bank supervisor.
"I think the present system of supervision does not make sense and does not conform with advancing the idea of a single market in Europe," he added.
"I am very much for making big steps here, but I am afraid the political will has not been there until now."