The Financial Services Authority will be broken in two. Part will become a new Prudential Regulatory Authority within the Bank of England, responsible for ‘microprudential’ regulation of financial firms.

Led by Sir Hector Sants, now FSA chief executive, it will report to another new Bank organ, an independent Financial Policy Committee, charged with ‘macroprudential’ regulation – ensuring systemic risks do not build up in the economy.

Most other FSA staff are likely to join a separate Consumer Protection and Markets Authority, which will “regulate the conduct of every authorised financial firm providing services to consumers,” and be responsible for “ensuring the good conduct of business in the UK’s retail and wholesale financial services”.

A third agency will bring together all the groups fighting white collar crime.

The multiplication of regulators could mean derivatives firms will have to cope with more reports and more inspections that disrupt their business.

Anthony Belchambers, chief executive of the Futures and Options Association, expressed concern that the reorganisation could disrupt progress that has been made. “The FSA is a very different institution from what it was before the crisis,” he said. “It makes sense to build on the FSA’s strengths and achievements of recent years and maintain that momentum.”