Sir Mervyn suggested problems were so deeply rooted within institutions that the widespread resignation of top bankers would do little to help.
"Other people will come along and behave in the same way," he warned, as he denounced what he described as "deceitful" behaviour among some senior executives. Instead he called for a "real change of culture", as he listed a litany of grievances against the banks in recent years, including this week's scandals of rate fixing and mis-selling to small businesses. Sir Mervyn said: "From excessive levels of compensation, to shoddy treatment of customers, to a deceitful manipulation of one of the most important interest rates, we can see we need a real change in the culture of the industry."
But pressed on calls for a public investigation into banks' behaviour, he ruled out the need for a Leveson-style inquiry.
He said: "We do not need an inquiry to know what we should be doing. There must be many people who work in the banking system today who know that they are honest, hardworking and feel they are being let down by some of their colleagues and indeed their leaders. What I hope is that everyone understands something went very wrong with the UK banking system and we need to put it right."