Vince Cable is demanding the FSA follow in its US counterpart's footsteps and goes public with details of its stress-testing of UK banks.
In a letter to the regulator, the Liberal Democrat shadow chancellor says it must declare the terms of its inquiries to help avoid undermining confidence in the sector.
The letter, addressed to FSA chairman Lord Adair Turner, says it should include the methodology it employs, the scenarios used and the results of the tests against the benchmarks.
Cable's remarks come just a day after the Federal Reserve determined 10 of the 19 banks it tested would require additional capital.
"We need a system that is as open and transparent as that in the US," Cable writes. "It must be made clear to the markets and to the taxpayers who are supporting the banks [and] exactly what the banks are being tested against."
Cable also accused the FSA of focusing its attentions on mutual building societies rather than "the banks who created this crisis".
"The FSA must therefore come clean about exactly what it's testing and what the results are. If schools can have their SATs results published, then the banks should have their results published too."
On Thursday, the Federal Reserve announced 10 US bank giants must raise a total of $74.6bn, meaning just nine tested institutions have enough capital to withstand a deeper recession.
Among the banks needing additional capital are Bank of America, which needs the most, Wells Fargo, GMAC and Citigroup.
They have been ordered to submit a plan to raise capital by 8 June.IFAonline
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