“Last week brought a tale of two banks. At one extreme is the Co-operative Bank in the UK, which reported annual losses of £1.3bn on Friday. The mutual lender is now seeking to raise £400m from shareholders to shore up its capital, which has fallen close to regulatory minimums.

“At the other end of the spectrum is Wells Fargo, the biggest US bank by market value, which reported quarterly profits of $5.9bn. This extends the San Francisco-based lender’s three-and-a-half year streak of record quarterly earnings and further enhances its reputation as one of the winners from the financial crisis.

“So what lessons can be drawn from these two cases when attempting to work out how to make banks safer?

“The Co-op Bank and Wells Fargo have a few things in common. They are both domestically focused retail banks that came through the financial crisis relatively unscathed, allowing them to embark on transformative takeovers of weaker rivals.”

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Read full Financial Times article here.