Ten years ago today, Prime Minister Gordon Brown convened G20 leaders in London to rescue the global financial system from collapse. In the months leading up to the meeting, turbulence in financial markets brought the world’s largest banks to their knees and plunged major economies into recession. The UK, with one of the biggest, most complex, and most interconnected banking systems in the developed world, was uniquely exposed.
After the meeting, world leaders promised to take bold action to “repair the financial system to restore lending; strengthen financial regulation to rebuild trust; and reform our international financial institutions to overcome this crisis and prevent future ones”. A decade on, what has changed?
At the global level, banking sector assets have increased by $40 trillion while total debt has rocketed by 60%. Many experts are now warning that another crash could be just around the corner. Closer to home, the UK banking sector is still dominated by a small number of large, shareholder-owned banks. While billions of pounds are lent into the economy each year, most of this flows into property and financial markets, inflating asset prices and enriching a few at the expense of the many. Banks continue to have low levels of public trust thanks to repeated scandals, while a ruthless programme of branch closures has left many households and businesses without access to basic banking services.
