Bank of England governor Sir Mervyn King said he was leaving the institution "in safe hands" as he signed off his final annual report before being succeeded by Canadian Mark Carney.
Sir Mervyn argued in his foreword to the report that actions taken by the Bank during his time at the helm had put the UK economy on the road to "gentle recovery". But he insisted that controversial measures forcing banks to build up their balance sheets were necessary to guarantee sustained growth.
The Bank's Financial Policy Committee has told banks they must hold an extra £25bn to guard against future shocks, but critics including Business Secretary Vince Cable say the move will depress lending to small and medium businesses that is needed to get the economy moving. Sir Mervyn defended his record, saying the Bank's Monetary Policy Committee (MPC) has had to "strike a delicate balance" on trying to boost the economy with inflation remaining above its 2% target due to energy prices, rail fares and tuition fees, but wage growth subdued.
Sir Mervyn, whose salary is £305,368, will retire with a £5m pension pot.