My other suggestion is that to practise banking, one needs a license, which can be revoked.

Now that I think of it, Taleb's suggested that banking should be a civil servant job. So, no financial engineering or bonuses, just boring paperwork.

In the wake of the financial crisis of 2008 (IIRC), the role of regular banking and hedge fund activities was split in two. The idea is, of course, that if all the fancy derivatives blow up, it wouldn't take retail banking with it. I read recently that the UK government was thinking of dropping this, which seemed a bad idea.