Clive Cowdery’s proposal to roll up Britain’s smaller banks into a larger, better-capitalised institution looks like an attempt to repeat his successful consolidation of parts of the UK life assurance industry. In practice, however, the latest plan presents a whole new set of challenges.

At first glance, there are some similarities between the current state of UK banking and the life assurance industry in the wake of the collapse of the dotcom bubble, when the value of equity investments was slashed.