The world of banking has changed dramatically, if not radically, in the five years since September 15th 2008, the day Lehman Brothers went bust.
American and European banks used to dominate the list of the world’s biggest banks (see chart 1); the Chinese have since scaled the charts.
The balance-sheets of Europe’s behemoths have got quite a bit smaller (chart 2); consolidation has made America’s giants bigger than ever.
Western banks are generating much lower returns on equity than they did in the years before the crisis (chart 3), in part because the industry is being forced to fund itself with higher levels of equity than in the past (chart 4).
So cost-cutting is much more important than it was: compensation ratios at investment banks have fallen (chart 5).
But those who want a complete reshaping of finance can still argue that change has not gone far enough: more people work in finance in London in 2013 than did in December 2007 (chart 6).
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