The collapse of Lehman Brothers and change in status of Goldman Sachs and Morgan Stanley, from being investment banks to more regulated institutions, marks, as many pundits have noted, the end of an era in finance.

But it remains to be seen if the recent upheavals in the banking system will change some of the fundamental behaviours of the world’s largest financial institutions.

In particular, will the old investment banks and other institutions threatened by the credit crunch’s upheavals, change their approach to their image and communications?

Among the financial press, the large investment banks were often noted for the pains they took to control what was said about them.

Journalists were, and probably still are, asked if they would submit quotes for approval, and access to in-house experts was strictly controlled.

Use of corporate logos and other images was heavily policed, while public relations departments no doubt fretted over the image of investment bankers as vastly overpaid, ruthless deal-makers and traders.

But at the same time as the compliance departments, press teams and image-makers poured their efforts into micro-managing the risks of an inaccurate quote in the press, or the reproduction of a logo in the wrong colour, other parts of the banks were running risks that would ultimately threatened their long term future and status.

This was not just happening at investment banks.

In the UK, the major high-street bank, HBOS, and a former building society, Northern Rock, have been severely weakened and pushed into a merger and fallen into public ownership, respectively. In the States, AIG is now effectively nationalised and a host of other institutions could be bailed out under the rescue measures now deemed necessary.

In virtually all of these organisations, it appears that risks were controlled scrupulously where there was minimal real danger but not where the risks were greatest – in business strategy, investment policy, the use of leverage and exposure to counterparty risk.

It is a bit like a car driver checking his tyre pressures and fastening his safety belt before driving the wrong way down a motorway.

One purpose in spending some much time and effort in managing the micro-risks was to try and make financial institutions appear invulnerable to the outside world.

Did the institutions succeed too well in this task for their own well-being?

Perhaps the managers believed in the carefully nurtured myths of their superiority and success.

Or perhaps some institutions wanted to control the minor ‘controllables’, in an effort to compensate for major risks which were being run elsewhere in their businesses.

No doubt the causes of the banking collapses of the credit crunch will be carefully studied in the future.

When they are, it will be interesting to see if how and why the risk management systems failed and if too much time was spent on relatively minor issues, when the bigger picture was neglected.