The start to this year has been little short of dismal for most investment banks. The deals have evaporated and unless the tide begins to turn soon, there is going to be more savage cost-cutting and job losses.

When the downturn began to bite in the first half of last year, it looked as though it was largely a cost problem - a hangover from the profligate attitude to pay and overheads during the boom. A year on, costs have been cut across the industry but falling revenues are now leaving a yawning gap.