James Moore: Scaring the children – or the City – is not helpful

Outlook City regulators should be what parents who work in the City of London frighten their children with before the nanny puts them to bed, at least in the view of Hector Sants, who gave his final speech as the chief executive of the Financial Services Authority yesterday before moving to the Bank of England.

"People should be very frightened of the Financial Services Authority," he said. Presumably he wants the same to be true of its successors.

That sort of statement tends to upset people, prompting City folk to talk about jackboots and bully boys while muttering about moves to sunnier climes where regulators sit down to G&Ts with bank bosses after work.

It is fair to say that the statement is hardly constructive. Creating an atmosphere in which those who work in London's financial centre have a healthy respect for watchdog might be more sensible.

But respect really has to be earned and Mr Sants says senior bankers are still too focused on earning money to do that.

In fact, he says, it is frequently the case that individuals put up for top jobs do little due diligence, lack proper understanding of the risks and challenges facing their prospective employers, and are motivated by a cloying sense of entitlement.

The sad thing is that his words won't come as any great surprise. They will merely confirm what most people already felt was the case.

Beyond a plea for better behaviour, Mr Sants' speech was rather light on ideas for effecting change. In fact, if the Co-op is ultimately barred from taking over the 600-plus branches that Lloyds has to sell, the watchdog may actually be open to charges that it is reinforcing the existing order.

Mr Sants called upon banks and bankers to be motivated not so much by money as by a desire to do the right thing. Which suggests he hasn't studied the history of the Square Mile very closely.

The trouble is that what he seems to be saying is that the world would be a much better place if people just took it upon themselves to behave a bit better. If only it were so easy.