Margaret Cole, the Financial Services Authority's director of enforcement, has privately ruled herself out of the running to take over from Hector Sants, the regulator's chief executive.
Ms Cole hit the headlines recently, following a number of City swoops, including a recent raid on an insider trading ring linked to employees at Deutsche Bank and Moore Capital.
"She enjoys what she does, she is good at it, and she knows that the person who takes over the role needs to be a banker," said a source.
The search for a new chief executive began after the coalition Government ditched plans to scrap the FSA.
A meeting was held at the regulator on Thursday to discuss the appointment of a new chief executive ahead of Mr Sants's exit in the summer.
Though there are likely to be many candidates with banking experience, it's thought Nick Prettejohn, a former boss of Prudential's UK business, who quit after he lost out to Tidjane Thiam for the chief executive's post at the insurer, has thrown his hat into the ring.Reuse content