Approximately 250 banks should buy insurance against rogue-traders, the chairman of SVB Holdings has warned.

Rupert Villers' comments followed growing concerns that financial institutions are vulnerable.

Last week, Allied Irish Bank reported that $750m (£524m) was missing from its accounts.

The money is alleged to be connected to employee John Rusnak, who was widely reported to have disappeared, but who in fact was being interviewed by the FBI over the weekend.

In 1995, Nick Leeson brought about the collapse of Barings Bank after running up £850m of losses on the Far East stock markets. He was jailed for six-and-a-half years.

Villers said his Lloyd's agency has so far sold about 20 rogue-trader insurance policies, but "the difficulty we have found is that you are insuring a financial earthquake".

"Every one of the 250 banks that should buy this kind of coverage says to itself `it won't be me'," he said.