London: It was exactly on this day – September 07 - a year ago that the first sign of global economic crisis began to surface. The severity of the crisis dawned with the collapse of one of the world`s oldest and most respected investment banks, Lehman Brothers
The collapse of Lehman Brothers was the biggest bankruptcy in corporate history. The collapse created panic in an already battered financial system, freezing short-term lending, and marking the start of the liquidity crisis.
The collapse meant thousands lost their jobs in these countries, which faced years of damage to their public spending plans as the rescue and the economic collapse has led to huge government deficits in both countries.
Once the initial rumble calmed stocks markets were down 40 percent and major banks in the USA and the UK were surviving on government support. The world had entered into the worst economic recession in 60 years.
Though the government across the globe quickly swung into action, many questions are still left unanswered.
It is with an objective to seek answers to these questions and charting the future course of action that top executives from some of the world`s leading banks are gathering for a conference in Frankfurt this week.
Even the conference moderator has doubts about whether the crisis has loosened the banking industry`s attachment to a bonus-driven business culture.
"Bankers don`t seem to have learned a lesson, so regulators will have to do it for them," said Wolfgang Gerke, an honorary professor at the European Business School and the main moderator at the annual `Banks in Transition` conference.
"Bankers are still being rewarded for taking big risks. The basis for measuring a bonus is still short-term profits, particularly on the trading desks at an investment bank."
Regulators are moving to put banks on a shorter leash.
G20 Finance Ministers and central bankers at the weekend discussed ways to curb some of the excesses that led to a near collapse of the global financial system.
Late on Sunday, central bankers decided on a new framework for bank supervision, including new rules on capital requirements, a minimum global standard for liquidity and ways for smoothing banks` vulnerability to economic ups and downs.
Below is a brief timeline of the events that unfolded over just a few days last September leading to the current crisis:
September 07, 2008: Fannie Mae nationalised
September 15, 2008: Collapse of Lehman brothers
September 18, 2008: Lloyds takes over HBOS
September 19, 2008: US bail out plan of $700
September 29, 2008: Bradford and Bingley nationalised
October 05, 2008: Bail-out plan agreed by Congress
October 12, 2008: UK bails out RBS and Lloyds-HBOS