Adviser to the Central Bank of Bahrain Governor, Dr Michael Taylor, has produced a major report on financial regulation.

His publication, for the London-based think tank, the Centre for the Study of Financial Innovation (CSFI), has defined the debate on the institutional structure of regulation and is an update on his previous work on the subject.

Twin Peaks Revisited - A Second Chance for Regulatory Reform is the name of his report which updates work he carried out in 1995.

In this report he has refined his earlier argument to tackle the problem of 'too big to fail' institutions.

Following the principle that regulatory structure should mirror the industry, he says that TBTF firms should be regulated separately and heavily - with a systemic risk tax as the price for being 'bankruptcy remote'.

'Twin Peaks: a Regulatory Structure for the New Century' produced in 1995 proposed the then radical approach of establishing two separate regulatory agencies responsible for prudential supervision and consumer protection respectively.

His ideas were subsequently influential in regulatory reform in countries such as Australia and the Netherlands.

'This report is an important contribution to the international policy debate on how best to respond to the global financial crisis,' said CBB Governor Rasheed Al Maraj.

'Its argument deserves careful study by regulatory policy makers across the globe.'-TradeArabia News Service