Recent crises -must be wake-up call to us all'

The Prime Minister said he wanted to see the international Financial Stability Forum become a better warning system for emerging risks, such as the possible collapse of a bank.

Mr Darling said a tightening up of the UK's warning systems could help prevent a repeat of the Northern Rock disaster, which has sent shares in the Newcastle-based plc to a record low.

It came as Mr Darling unveiled reforms guaranteeing an individual's bank and building society savings up to £35,000.

Previously only the first £2,000 of people's savings and 90 per cent of the next £33,000 were guaranteed by the Financial Services Authority.

Speaking at Canary Wharf, in London's Docklands, he said: "In the current market circumstances we are providing a guarantee for Northern Rock's depositors.

"But for the future, we now need to put in place a better regime - a new orderly process with a better protection scheme as its foundation."

Ultimately, Mr Darling has said he wants up to £100,000 to be fully protected, but new laws are needed to raise the threshold that far.

Yesterday, the Chancellor said the regulatory system had to take into account the fast-moving nature of financial transactions and the fact individual consumers might not respond in a way economists would regard as rational.

He said: ''We, as Government, can do things that you as individuals cannot, and equally we recognise that there are many things that you can do as businesses which will reinforce the same objective.

''It is only by acting together and recognising that we need to make changes in a changing world that we can ensure we have the right level of approach and we don't get into a situation where we over-react only to repent at leisure, as some countries have found."

Mr Brown told the meeting the recent turbulence in the financial world was a ''wake-up call", highlighting the need for global and domestic reforms in the regulation of finance.