Britain's top financial regulator Hector Sants announced to resign, rendering markets in a shock and casting doubt over the future of the Financial Services Authority and an overhaul of the sector.

Mr. Sants had been a vocal advocate of banking reform, both in the UK and internationally, in the wake of the financial crisis.

He had also been outspoken in his criticism of plans by a potential incoming Conservative government to disband the FSA. The opposition Tories wants to give the FSA's supervisory role to the Bank of England and extending consumer protection responsibilities to a new agency.

Sants, who will leave in the summer, revealed that he had already planned to handle the post for three years. Also Industry insiders claim that Sants has been talking to colleagues about his departure for some months.

"It comes as a surprise, but the air of uncertainty hanging over the FSA is presumably a major factor in his decision", said Ben Kingsley, a partner at London law firm Slaughter and May.

Several industry observers had extended tribute to the gracious Sants, whose warning to bankers last March -- "be afraid, be very afraid" -- ruffled the feathers of a once powerful industry, and cautioned banks against any collective sigh of relief at his departure.