In the letter sent to Darling today, Shadow Chancellor George Osborne said it is an urgent priority to reform the current banking regulations as suggested by Bank of England governor Mervyn King at a Treasury select committee meeting this morning.
Osborne said action was required as soon as Parliament returns in October and called on Darling to make a full statement on what he plans to do in the next few days.
King told the TSC the problems at Northern Rock stem from legislative obstacles, such as the Market Abuses Directive, UK takeover rules and the procedures affecting banks going into administration.
King said these issues should not be made political and called on cross-party support for the changes.
The letter says: “I believe that the necessary legislation must be passed as quickly as is reasonably possible through Parliament.
“This should happen as soon as Parliament returns in October so that we can replace verbal promise you gave on Monday with solid statutory arrangements that ensure the stability of Britain’s financial system.
“My front bench team and I are therefore ready to open discussions with you and your colleagues immediately to put these reforms in place.”