The financial crisis still haunts us but Brexit is doomed to have an even bigger impact

There are reasons to feel very nervous about Britain’s future

As well as writing for Voices, I usually pen at least one, sometimes more, financial comment every day. One thing that often strikes me as I write these columns is how loudly the chains of the ghosts of the financial crisis are rattling, even though we are 10 years on from the event.

The fingerprints of the crisis are all over two important stories haunting financial markets today. The first is the attempt to merge Deutsche Bank with its smaller rival Commerzbank, in a bid to pull the former institution out of its funk. The move is being backed by Germany’s government and could see thousands of jobs cut, with the axe falling particularly heavily upon the bank’s sizeable London operation.

Deutsche is a real worry for the watchdogs. It’s huge, and if there was another snafu, watch out. It could ultimately cause one. Regardless, a wilting Deutsche would be a real danger. Lehman Brothers? A slight squall by comparison. There aren’t many who believe the merger will work.

The other one I’ve been watching is Metro Bank, one of a string of “challenger banks” that the crisis coughed up in Britain. At the time, the government hoped they would inject a little life into this country’s heavily concentrated market, dominated as it is by five big institutions (if you include Santander along with Barclays, RBS, Lloyds and HSBC).

That doesn’t look so good now. First there was TSB’s IT cock-up. Now Metro – with its seven-day opening at branches, balloons for the kids, free dog biscuits – is struggling. It is facing pressure to shake up its board, amid a mounting scandal over some fairly egregious errors it made in the way it calculated its capital reserves.

Regulators watch those errors very closely these days because of what the crisis revealed about the banking system. I doubt they’re sleeping well at the moment. Chuck in ultra-low interest rates, which make it hard for banks to make money, and the slow pace of reform when it comes to the Eurozone’s big guns, and it’s no wonder commentators like myself feel haunted.

However, an even greater horror story plays out in front of our eyes. Of course I’m talking about Brexit. There are reasons to feel very nervous. Two years after the financial crisis, Rolling Stone’s Matt Taibbi memorably described Goldman Sachs as a “great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money”, in a hardnosed analysis of that bank’s role in the affair.

The impact of Brexit on Britain is set to be more profound than the crisis, and its ghosts will be with us for much longer. What phrase will be appropriate to describe the architects of that undead monster?

Yours,

James Moore

Chief business commentator