Friday, 4pm and the markets are tanking. The new minister for the City has had enough. “Let’s go outside, I need some air,” says Paul Myners, leading the way to a Treasury courtyard. Too windy. We retreat to the canteen - coffees all round. It’s been that kind of week.

Myners, 60, looks tired but determined. He was appointed a government minister nine days ago. Since then things have got progressively worse - banks on the brink, global stock markets diving, Chancellor Alistair Darling’s support package barely holding back the torrent of bad news. Just don’t call Darling’s initiative a bank bailout.

“It’s not a bailout, it’s a workout. Bailout signifies paying off someone else’s debts. Workout points you towards value and support. The programme we announced on Wednesday morning was targeted at three critical areas posing challenges to our banks. One, capital. Two, liquidity. And three, extending maturity of funding.”

Was it leaked? Myners takes a deep breath. “I know of no such stories.”

But the markets knew? Another pause.

“I think people in markets are quite good at analysing what the options are and people elsewhere were coming to broadly similar conclusions. It’s not entirely surprising, but I think the element of our proposal that was not anticipated, which was the most important one, was steps we have taken to get banks back onto a more balanced funding diet. They have become increasingly dependent on short-term funding – by issuing credit insurance on market-price basis we should be able to get banks back to a more balanced funding position.”

He stops and waits for the next question. Myners, burly and laconic, is holding himself on a short leash. In his tightly buttoned suit and open-necked white shirt, he looks more jazz singer than minister. He has relinquished a clutch of chairmanships - Guardian Media Group, Land Securities, Tate Gallery trustees, among others – to enter government. And chucked his usual, more prickly style.

Just listen to this. Ask him which among the banks got it right and which got it wrong, and last month he might have jabbed a finger. Now? “It would be invidious to talk about individual cases but there are lessons to be learnt here. I hope shareholders and owners of these businesses are keen to learn those lessons.”

So what is the new minister going to do? Ban bonuses, cap pay, legislate to curb reckless behaviour? It’s all out there in the political ether. Myners studies his coffee.

“I think regulation is one aspect of enhancing confidence in financial institutions. Others include self-healing through improved governance, more effective boards, more considered analysis of incentive plans and the behaviours they will produce, and stronger capital.

“There isn’t a single silver bullet here, regulation in itself without support of those other features will lead to a potential frustration of innovation and probably higher cost of funding.”

So the government won’t cap remuneration? That’s not what the prime minister has been implying.

“The Financial Services Authority is producing a code on remuneration. The FSA has quite correctly concluded that the incentive effects of remuneration arrangements appear to have induced reckless behaviour, and so the FSA view is that if it is not happy with the way incentive effects work it will require a higher capital requirement for the institution, which you could see as requiring more insurance. If you are at the riskier end of banking you will need stronger capital ratios than if at the less risky end of banking.”

Carefully put? He smiles beatifically. “I am always careful in what I say. I have a reputation for care.”

And these are serious times, so Myners is not going to win admirers by cracking jokes with me. His breadth of experience - in fund management, on hedge funds, advising the Bank of England and sitting on big company boards, including two “unhappy” years at NatWest - makes him a clever choice to intercede between politics and business.

But he’s not a patient man, nor does he like to do nothing. After earning a £30m fortune in the City running Gartmore, he reinvented himself at 50 with a string of portfolio jobs: new life, new wife, new family and a passion for collecting contemporary art. He has also written a string of reports on the City for government, and he’s formidably well-connected.

So what will he do as minister in charge of financial services? Nothing is rarely an option for Myners, yet he seems to be counselling caution.

“I think there are lessons to be learnt for everybody, and in particular for banks. But I just want to say one thing: I hope we don’t see a demonisation of banks and bankers because the reality is there are hundreds of thousands of people working in the banking industry on quite moderate incomes who work very well and professionally and I wouldn’t want to see their commitment and contribution demonised by allowing the term banker to become derogatory.”

As for any pressure to punish bankers or regulators for getting us into this mess, he says the mechanisms for sorting things out are already there. Most banks are public companies, remuneration policies have to be put to shareholders for approval; it’s up to investors to challenge those policies.

Surely that’s never worked in the past? The argument has always been that it’s a market for the best executives, and like Premiership football stars, their value soars ever upwards.

“So a period of calm reflection might lead to some previous conclusions being rejected,” he counters.

And you’ll leave it to shareholders rather than legislate? Myners hedges his bets. “I believe there are legitimate public-policy concerns, but it is for others to decide what the right response should be. The front-line response should lie with owners of businesses - they are the ones who have suffered as a result of management failures.”

And what of the tripartite system splitting responsibilities between the Treasury, the Bank of England and the FSA? Surely that needs some overhaul? Myners shakes his head. “There is nothing fundamentally wrong with the tripartite system.”

So it’s the players, not the system? “I am saying, um, the FSA has clearly acknowledged it didn’t perform as well as it should have done.”

And the Bank of England? He pauses again, then starts: “The Bank has performed an effective role in providing liquidity when required, and has given good advice to the chancellor. But, yeah, I think things can be made to work better, and I am committed to do that.”

For now, he says, there will be no rush to draw up more regulation. “Before I get drawn into stating policy positions I need to get my feet under the desk, meet with a broader group of people and establish my team - that I obviously haven’t been able to do because we are in the middle of supporting the chancellor in bringing forward policy responses to this set of challenges.”

He shrugs. He’s eloquent but exhausted. At one point, he stumbles his words then apologises. “Sorry, I’m a bit hesitant. I’ve not had a lot of sleep this week.”

Need a curry? He laughs. The media’s reporting of the Treasury’s Tuesday night balti may be government spin, but it clearly struck a chord with some. Myners nods, then adds: “I didn’t have the curry.”

He may find government a struggle. For all his chairmanships, he’s not happy to toe the line. As a City high-flyer who is neither Oxbridge toff nor bristling barrow-boy, he has long confounded expectations.

Now he has houses in Cornwall, Berkshire and Belgravia, and a growing collection of 20th-century art. He counts journalists and artists among his friends. Many are bemused at how he has changed himself. Two years ago Sir Howard Davies, a fellow Tate trustee and Myners fan, told me to ask him: “Where have all your ties gone?”

That desire for change, though, reflects Myners’ early years as first a teacher, then a journalist and finally a fund manager, with diversions along the way. He explains it thus: “I have a strong drive to achieve, but at the same time a wish to lead a broader life than a narrow one that is confined to business.”

Another says Myners needs to be needed. He was an adopted child who spent the first three years of his life in an orphanage in Bath, and has never traced his natural parents. “I don’t think it’s a useful use of time,” Myners told me in 2006. Instead he keeps moving forward, and has to be at the centre of things.

“But I like to think I am very comfortable in my own skin. I spent 20 years at Gartmore and 11 years at Rothschild doing three distinct jobs. I think I am just always questioning, always looking for other ways of doing things.”

Myners ascribes his ambition to his adoptive parents. His father was a Cornish butcher, his mother a hairdresser.

“My mother in particular was a strong believer in education and self-improve-ment, and she had high moral and social values. She was a Methodist and had an idea of community purpose. I think she had a huge impact on me.”

That purpose could now find full expression in Myners’ new role, if he is prepared to grasp it. The fact he has resigned from so much shows how seriously he takes it. He will have no shortage of contacts on whose advice he can draw.

They will want to see how he squares his City past with the growing public anger at banker greed. The government will hope he can help steer a middle way.

Whatever he does, he promises, will be effective. “ ‘Overregulation’ and ‘light-touch regulation’ are phrases which trip easily off the tongue. I am talking about effective regulation, and that must be global and the prime minister has made it clear that one of the root causes of our problems here is the fact we have opportunities for regulatory arbitrage and it requires a global response.”

For now he’s convinced that last week’s Treasury initiative is a step in the right direction. And, he promises, the taxpayer will see a benefit.

“At each point the taxpayer is going to be rewarded. Liquidity provision through the Bank of England is against high-quality security and with a positive interest margin. The provision of capital if required to the banks will be on commercial terms. And the deposit insurance will be priced against credit-default swap rates plus a margin. So I would expect the taxpayer to be rewarded for the support that is provided.”

And the timescale for that? “I am not a soothsayer but our expectation would be we will be rewarded from day one, in the sense that there is an interest margin, an insurance premium and if there are preference shares a coupon on the preference share.”

Then he adds: “When the media tot up the total size of the support I think they confuse different elements here. The £200 billion of liquidity support under the Bank of England’s liquidity scheme is fully secured against high-quality collateral. The capital provision if the government becomes a shareholder is clearly risky but we would expect it to be priced to reflect that and to produce returns consistent with that.”

Yet the markets still fall? He sighs. “There is continued uncertainty around the world, but it is important to emphasise that this again points to the fact that this is a global problem that started in the US but affected the rest of the world . . .”

By now an aide is crossing the canteen floor. “The chancellor?” asks Myners. He has got to go. “Anything you want to check?” he shouts as he backs towards the door, “I’m still passionate about contemporary art . . .”

Is it true he resigned from £1m worth of salaries to take this job unpaid? Too late. He has turned and just shrugs his arms up, as if to say who knows? Likewise if things will get better on Monday. We’ll find out tomorrow.