In an article for the Financial Times, the Conservative minister insisted that a "credible plan" to overhaul the EU's financial regulatory framework is essential and suggested ongoing banking weakness could threaten the current recovery.
"We must ensure that banks have the support they need to withstand market concerns," he wrote. "It is now clear the new stress tests must be much tougher. They should cover a three-year period and look at liquidity."
Mr Osborne added that the financial sector must be placed in a position where it is capable of covering the cost of any further shocks and said it is "vital" similar legislation is introduced in the US and elsewhere.
The chancellor also called for continued action on tackling national budget deficits. He observed that the "sense of crisis" surrounding the issue had lessened somewhat in recent months, but warned that market concern continues to linger.
He criticised the EU stress tests conducted last July, which he pointed out had indicated a capital shortfall of â¬3.5 billion ($4.59 billion) when Irish banks required ten times that amount in aid as part of the much-publicised recent bailout.
European politicians were discouraged by Mr Osborne from letting "unnecessary distractions" get in the way of introducing a robust overhaul and claimed talk of competitions between EU financial hubs overlooked the key objective.
Last month, the Bank of England recommended in its Financial Stability Report that the next round of stress tests should be more transparent, but claimed British financial institutions had displayed increased resilience to future risks.
By Claire Archer