ACFA Aidan Vaughan attacked the more aggressive activities of investment bankers, namely credit derivatives, as he warned that unrestrained investment banking activities could lead to even bigger financial crises in the future.

“ACFA strongly encourages Mervyn King, the Governor of the Bank of England, to stand up to the banks,” he said.

“The public is angry especially when they see bankers again earning huge bonuses when it is tax payers’ money that has rescued the day.

"For most people, taxes are rising, wages are static, inflation is rising, living standards are falling and government expenditure is being cut dramatically.

“The banking crisis of the last two and a half years has been the result of a gathering 60-year credit explosion plus a toxic combination of unrestrained greed, globalisation and loose government regulation.

"The basic biblical principle of ‘spending less than you earn’ has been ignored on a massive scale.”

Mr Vaughan questioned the effectiveness of the Project Merlin deal struck between the government and the UK’s four biggest banks last month.

The deal commits banks to lending more money, particularly to small businesses, improving transparency over pay, and awarding smaller bonuses than last year.

Mr Vaughan said he was concerned by the apparent failure of Project Merlin to “satisfactorily align the long-term investment needs of the nation with the avaricious short-term ‘enrichment’ needs of investment bankers”.

The ACFA, which promotes Christian standards in the financial sector, is calling for the break-up of failed banks RBS and HBOS.

“The Government [should] consider breaking up these two monolithic organisations to encourage more competition for high street and commercial banking services,” said Mr Vaughan.

He warned that the wide gap between “paltry” bank savings rates, high commercial lending rates, and large arrangement fees was “unjustifiable and borders on exploitation”.

Instead, the Government should force the banks to develop lending to small and medium sized enterprises, he said.

“Short-termism and the 'inflated bonus culture' should be seen as what they are - greedy and counter-productive,” he said.

“Whilst few in the nation are blameless, we are all borrowers in one way or another, it is time to ‘live within our means’ and effectively save for all our futures.

“Failure to do this will mean that ultimately the bugbear of inflation will steal all our livelihoods away and the inexorable drift of economic power eastwards will gather pace.

“Fundamentally, the bond of trust between the public and banks needs to be restored.”