It says much about the new chairman of the Financial Services Authority that as I enter the watchdog's building at Canary Wharf, he bounds down the stairs to greet me. He leads me through security himself, then back up the stairs to a small meeting room. The walls are bare, the space filled by a table and chairs squeezed together - a quick count shows 16 chairs in a space that in one of the neighbouring banks would be used to house just one person.
It's like Turner's Toyota Prius, parked outside. Not for the City's chief overseer a Maybach saloon or a Bentley Continental, but a 'green' hybrid to go with his other chairmanship - of the Committee on Climate Change.
The tight quarters are symbolic of a cramped, pressured organisation, overworked and struggling to cope. Looking around, I try to picture it filled with bankers and officials as they grapple with yet another aspect of the credit crunch.
In keeping with this vision is Turner himself. He's 53, tall and lean, with a full head of wavy silver hair. His suit, shirt and tie are smart but understated. His glasses give him a serious air but he has a warm, impish smile. He could easily pass for a university don - the economic-history lecturer who has the girls swooning.
The effect is augmented by his speech. He talks non-stop and quickly, spewing out point after point in perfectly ordered sequence, as only clever, self-confident people can.
Lord Turner of Ecchinswell, to give him his full title (Ecchinswell is a village on the Hampshire downs and he has a house there), is one of those types who seem to have been around for ever and are involved in everything of any significance. Trusted by government and private sector alike, they glide effortlessly between influential appointments, often bridging Whitehall and the corporate world.
But Turner wasn't born to rule. He has risen on a combination of a smart brain, ambition and charm. His father, a local government officer and town planner, worked in a series of new towns from Crawley in the south to East Kilbride in Scotland, where the young, academically gifted Turner spent most of his childhood.
Jonathan is his first name, Adair his second (his mother Kathleen, who died when he was a student, picked Adair out of a book of Scottish names). He quickly dropped Jonathan in favour of the more distinctive name.
He is one of four children. The family had little money and lived in a council house. But Adair was bright, winning scholarships to Hutchesons Boys' Grammar School in Glasgow, and Glenalmond, the Scottish boarding school, and then to Cambridge University.
He was determined to get ahead. He joined the university's Conservative Society and became its chairman (he later left the Tory party and joined the SDP, but now says he is apolitical). He became President of the Union.
His degree was meant to be in history but he added economics. One of his tutors was Mervyn King, now as Governor of the Bank of England a fellow member of the Tripartite banking supervisory authority (the third is the Chancellor, as head of the Treasury).
Turner taught economics after university. He went to BP but stayed just six months because he found the oil company too dull. He left to follow friends to Chase Manhattan bank.
That didn't satisfy him, either, and after three years he went to McKinsey. He stayed for 13 years, although he got 'a bit bored' after 10 and took over McKinsey's push to bring Western-style management consultancy to eastern Europe and the former Soviet Union.
This was all-consuming of his time, and although it was a high-profile role and a step up within the firm, it was not that conducive to family life. He lives in Kensington, West London, with his wife Orna Ni Chionna - she is Irish, a fluent Gaelic speaker and another McKinseyite - and their two children.
It's clear that McKinsey has never left Turner. He has the challenging, searching, rigorous manner typical of the firm's alumni - you can imagine him going into a new job and asking 'why?' over and over. He's also able to detach himself from his environment and view it objectively. So, despite being in the thick of some of the more hair-raising moments of the past few months, he is able to speak dispassionately, as if the near-downfall of the banking system is another conundrum to be dissected and solved.
When Sir Howard Davies put Turner's name forward to succeed him as director-general at the CBI in 1995, Turned accepted readily (Davies, MT's diarist, is also an ex-McKinseyite and former chairman of the FSA). A young leader of the employers' organisation, Turner carried on with his predecessor's modernisation programme. He cut the staff by 20%, moved the body into open-plan offices at Centre Point and equipped it with the latest technology.
As CBI director-general, he was the voice of business when the new Labour Government introduced a raft of work reforms: the social chapter, the minimum wage (he later chaired the Low Pay Commission) and trade union recognition. He decided to work with, rather than automatically oppose, Tony Blair's administration, to extract the best terms he could for his members.
This compliant policy wasn't to the liking of all CBI members. As a result, he was nicknamed 'Red Adair', after the famous US oil troubleshooter. Turner relished the limelight. He grew to love the role, too - in particular, the way it straddled business, public affairs and politics.
From the CBI, he went to Merrill Lynch Europe as vice-chairman. He remained in the public eye, however, by chairing the government-backed comprehensive review of the pensions system. It was a gargantuan effort, resulting in the Turner Report of 2005.
Turner didn't shirk from the breadth of the task, nor from predicting the future. In its thoroughness, his study was like a treatise on the whole complex subject. Some of his recommendations were radical, but they were all supported by closely argued findings. Most of his recommendations have been accepted by ministers, who seemed grateful that someone had been unafraid of tackling such a convoluted area and done the hard analysis for them.
Other jobs came Turner's way. He has lectur-ed at the LSE (headed by Davies). In 2007, he succeeded Frances Cairncross as chairman of the Economic and Social Research Council, and Baroness Jay as chair of the Overseas Development Institute's Council. In 2008, he was made chair of the Committee on Climate Change. Then he was made chair of the FSA, succeeding Sir Callum McCarthy.
He started in September, when the financial world was teetering on the brink. 'I joined in the biggest financial crisis since whenever,' he says, smiling at the memory. 'It was huge, and it was an extraordinary time to join.'
He didn't come to the FSA entirely cold. Ever since the credit crunch took hold in the summer of 2007, he was 'reading and thinking about it'. His interest stepped up several notches when he was offered the post last June. Even so, it was a baptism of fire. 'I joined one week after the Lehman's collapse. For three weeks after that, the markets seized up.' It was, he says, shaking his head, 'something of an extreme start'.
Looking back, he has no doubt that 'allowing Lehman's to fail was a mistake on the part of the US authorities, because it was the point that completely broke the confidence of people in the system'. Lehman's, he says, was in the 'too big to fail' category. He sees nothing wrong with the moral hazard argument - that you don't reward those who have screwed up by buying out their bank - 'provided it is directed against executives and investors'. But the ramifications of its disintegration went much further than teaching a lesson to the management and shareholders. It was folly to send it crashing down, he says.
What has to happen now, he says, is that 'a lot of the focus must be on how we regulate in a way that is very unlikely that governments and central banks will have to do this again'. Turner feels that too much is made of the 'light touch' argument - that the UK is soft on the banks, compared with, say, the US. 'The US is heavy on rules and the UK is more principles-based.' But, he says, that didn't stop the UK authorities cracking the whip when they wanted to.
He prefers to look forward, to a shake-up of the entire worldwide regulatory framework. Officials need to have a greater understanding of where the weaknesses are. In the week before he started, for instance, he attended two meetings of the Government's financial stability body - the so-called Tripartite Standing Committee. That was two more than McCarthy went to in his first four years at the FSA.
The truth is that, in the McCarthy era, the markets were booming. Nobody had the inclination to spend time discussing what would have seemed like a fantasy. Now Turner is determined that the good years in a cycle are used to provide a cushion for the bad, so that banks are prepared and the disasters we have seen are avoided. And whether an authority was rules-based or principles-based, he says, didn't matter. There were common approaches to capital adequacy and liquidity that were wrong. 'We made intellectual mistakes,' he says.
On capital adequacy, he maintains that the banks need to put more aside so they can cope in a downturn. On liquidity, not enough attention was paid to the business models of financial institutions to see whether they could function if the supply of funds were to be reduced.
An internal audit was conducted by the FSA on what went wrong in its supervision of Northern Rock and, says Turner, 'we accept mistakes were made'. There was a shortage of staff, and those employed failed to ask the right questions. There was too rapid a turnover of supervisors, so the FSA is hiring 200 extra staff to concentrate on bank supervision.
But, Turner points out: 'It was Northern Rock and Alliance & Leicester and Bradford & Bingley and HBOS together. They'd all grown very rapidly, but in a safe fashion, with a story to sell to investors. If they're all doing it, then it's the whole system that is risky, not just one bank.'
It is this that concerns him most: the failure of the regulators, not just here but everywhere, to understand the scale of what they were regulating and the inherent, systemic dangers involved. 'The FSA, in relation to systemically important firms, was trying to do regulation on the cheap.'
Each firm can be monitored in isolation, but if they all go down, what then? 'We need to apply cross-sectoral analysis to find out what is really going on. There were risks with Northern Rock but they became bigger because Bradford & Bingley was doing the same thing. If it's only one bank, that's not so difficult, but it's not.'
He is consumed by questions. 'If you apply rules in London, why not elsewhere? If you apply rules to a bank, then everybody will go to a hedge fund - so are hedge funds included?'
On pay, he is acutely aware of the public mood and the widespread belief that bonuses caused bankers and traders to behave recklessly. One answer that has been mooted is to pay bonuses in shares, not cash. On the other hand, the one bank that did that as a matter of policy was Lehman's, and look what happened there.
He's also mindful of someone being rewarded now for something that turns out to be a turkey further down the road. But although pay is right at the top of the public's check-list, it's not at the top of his. However much you regulate, 'you are still dealing with human nature', he says.
For example, 'if people do something and get paid in a while - as opposed to now - with a load of stock, does that alter their behaviour? They can't touch it, but they still feel rich and they will still want to do more.'
Turner would feel far happier if capital adequacy and liquidity were spelt out; they are the checks to be built into the system to stop the crisis recurring. A third desideratum is to boost the FSA's power to supervise. By tackling these three areas, he says, it's possible to put in enough controls so that if a bank's traders step out of line or its management wants to pursue a particular course, the brakes can be applied.
One aspect that worries him is forgetfulness. But what occurred last autumn is 'not just a downturn but a near-death experience'. It won't be forgotten in a hurry. For Turner, it's important that we guard against the next generation having no insight into what took place and not knowing how to avoid a repetition.
He's hopeful that the FSA's supervisory enhancement programme will help the watchdog get on top of increasingly complicated, intertwined markets. 'It's a commitment to significantly increase our resources and professional- ism. It will be devoted to analysis of what we see as really high-impact firms.
'Obviously, we've got our mass-market operational things: we regulate thousands of IFAs and other brokers. The point about this is that if one firm does badly, nothing happens to the overall financial system. At the other end, we're concerned with banks that have a trillion pounds; we've got to ensure they're safe.'
In the past, he adds, not enough attention was paid to the top end of the market - the FSA was seen as a consumer watchdog, concerned with the sale of products to the person on the street. Some organisations, he says, are 'high-impact' - Goldman Sachs, HSBC, HBOS, Citigroup... 'They're huge corporations and they're global. They need direct and careful supervision.'
There has also been confusion about the lines between the FSA and the Bank of England. 'A common theme in the past few months has been the overlap between us and the Bank, particularly in regard to our financial stability responsibilities,' says Turner. 'On that overlap, there's no doubt some things went missing. The Bank was focused on monetary policy and the control of inflation; we were focused on case-by-case supervision. There was not enough joining up.'
But isn't the supervisory regime confusing? Shouldn't there be one boss, overseeing the lot? He nods at the question. 'You can argue backwards and forwards the pros and cons - this way, that way. We have to accept this is how we do it, and make it work.'
He believes the FSA has to get tougher. 'Supervision has to be far more than ticking boxes. We have to get inside business models, to say to a bank: where do you get your money from? We will be far more analytical.' He wants the FSA to step back and look at a bank, at the system and how it fits into that system. The McKinseyite in him is working overtime.
It's impossible, he adds, to overestimate the cultural shift that has taken place. 'We'd created geniuses, who we really regarded as masters of the universe. But all they were doing was buying and trading assets in the money markets - they weren't geniuses at all.
'I've no problem with them wanting to do that, but they must have the money in the first place.' There is little likelihood, he admits, of curbing the urge to speculate, 'but we can do a lot about capital adequacy and liquidity'.
The ratings agencies are also a concern. 'Did the use of ratings play a role in what occurred? I think the answer is yes. Can the regulatory response deal with this? The answer is open.'
The use of ratings had grown, so that rather than just individual banks being assessed, products were as well. 'That experience has been more problematic. People have been missing the point of ratings; they tell you about the probability of default if you hold a product to maturity, not if you hold it for six months and then sell it. People believed if something was called AAA it removed the risk of selling rather than defaults.'
Turner leans back. 'Is the reliance on ratings agencies part of this financial crisis? Yes. Then what are we going to do about it? There are obvious conflicts of interest in that they're paid for by the issuers themselves.'
There is, he says, 'very clearly a strong risk attached to ratings agencies, but we have to think: what is it? There's a series of very important issues here. There's a role for the regulator in it, but we need to be careful if we think all problems can be solved by a regulatory response.'
Compared with other posts he has held, the FSA chair is 'among the most fascinating and demanding on a day-to-day basis'. The Climate Change Committee is 'important, fascinating and interesting - but it's not something that will be decided in the next 24 hours'.
He left the day-to-day FSA operations, such as rescuing B&B or dealing with the Icelandic fall-out, to the chief executive, Hector Sants, and his team. 'My role is to focus on the long-term issues,' he says. When he began at the FSA he had to balance two things. 'I was responding to the crisis and I needed to make correct decisions, while at the same time beginning to do the long-term thinking about what went wrong and making sure it doesn't go wrong in the future.'
He's non-executive and his agreement was to work three-and-a-half days a week. He has allowed for four. 'In fact, for the first eight weeks I was doing six-and-a-half days a week, with the other half-day on climate change.'
How does he relax? 'For the last two months I've had close to no personal relaxation. Normally, I enjoy reading and thinking about things.'
He is contracted for five years. At the end of his stint, he hopes things will be a lot calmer - banks will be putting more aside for when the cycle turns, and there should be a greater appreciation of the need to maintain liquidity and better supervision. But that's only the FSA and the UK. 'The difficult bit is where we go internationally - there has to be more international organisation and co-operation.'
He's off again, on the global challenges ahead and the need for worldwide reform. It's as if this crisis and the FSA job were made for him. Would he admit to enjoying himself? He grins. 'It entails a set of issues that interest me, so in that sense, yes, I enjoy it.'
He's smiling - it's as if all his life he has been working towards this moment. You can't say that about many people in this crisis.
THREE CHALLENGES FACING ADAIR TURNER
1. To prevent a recurrence of the near-collapse in the financial system - in particular, ensuring appropriate levels of capital adequacy and liquidity among banks
2. To make sure the FSA can properly supervise today's complex markets and giant banks
3. To persuade counterparts abroad of the need for an improved international financial regulatory framework
LORD TURNER IN A MINUTE
1955: Born 5 October in Ipswich, grows up in Scotland. Educated Hutcheson's Boys Grammar School, Glasgow, Glenalmond College, Perth and Caius College, Cambridge
1977: Graduate trainee at BP; leaves for Chase Manhattan Bank
1982: Joins McKinsey, stays 13 years, ends up leading expansion into eastern Europe
1995: Director-general of CBI
2000: Vice-chair, Merrill Lynch Europe, and chairman of the Low Pay Commission
2003: Chair, Pensions Commission, reviewing UK pensions system. Major report, 2005
2008: Chair, Committee on Climate Change, and chair, Financial Services Authority.