September 15th 2008 - a date which shall live in infamy?

Three years ago today, the collapse of Lehman Brothers sent shockwaves around the world, resulting in sheer panic in the financial markets and driving the final nail in the coffin of the wholesale funding markets.

Suddenly, big banks really could be allowed to fail.

The spectacular bust of America's fourth largest investment banks on 15 September 2008 lead to the bailout of multiple major banks in the UK and US and stiff action from governments to prevent a severe depression.

Clearly, the ramifications of Lehmans' bankruptcy, a year after the credit crunch and five months after it pulled out of the UK mortgage market, are still being  felt today.

Funding remains extremely restricted, banks are still attempting to repay their debts as several remain within the public purse, and general economic gloom dogs consumers as the austerity measures hit home (quite literally).Indeed, one senior investment adviser says the knock on wider monetary impact of Lehmans' failure is quite likely to be far bigger than it would have ever cost to bail it out.

So, where is the mortgage market now, three years on?

Following two years of serious strictures, the UK and the housing market both appear to be in a slow, fragile recovery. Mortgage funding has eased over the last 12 months, with house prices stabilising and gross lending holding at around £135bn.

Most notably, lenders have gone to war over fixed rates recently, slashing deals on an almost daily basis as funding gets cheaper, and long-term fixes dropping to the lowest levels ever seen. There has also been an increase in high LTV mortgages, but in reality it is those with large deposits who are really feeling the love from banks that remain deeply risk averse. And this is unlikely to change as concerns grow that the industry, and economy as a whole, could face further set backs.

It is interesting that the third anniversary of Lehmans falls in a week when the eurozone slides ever-closer towards a Greek default and the ensuing fallout, and the much-discussed Vickers report is published.The shadow of the eurozone looms large on the financial markets, with warnings that the "contagion" of a Greek default could create a bigger banking crisis than we saw in 2008.

Of course, hindsight is a wonderful thing and the lessons of old seem to be getting relearned the hard way.

Consider that, at the height of the "no more boom and bust" bluster in 1999, US President Bill Clinton decided to repeal the 1933 Glass-Steagall Act- a set of bills designed to prevent deflation and reform the banks following the financial crisis of 1929.The repeal essentially removed the protection dividing investment and retail banks, so allowing the casino banking deplored in recent years.

On this side of the water, lax regulation and lending rules allowed a similar scenario to build up, with government, homeowners and the industry caught in the thrall of believing that growth (and house prices) would continue to climb forever. Now, of course, in the UK we have the Vicker's report proposing the ringfencing of bank's retail and investment divisions by 2019.

Does anyone else smell a (strong) waft of irony? Good old fashioned prudence really is the order of the day for everyone from banks to consumers.

So, what of the future?

The effects from Lehmans will likely be felt for the rest of the decade, with lenders managing to pay down their debts in the next few years. Meanwhile, the easing availability of funding for mortgages could rely on how the eurozone fares. The financial markets are extremely nervous and the eurozone crisis could simply reverse the recovery we have seen in wholesale funding, mortgages and the economy.

How much more pain we have still to come is anyone's guess and I will leave conclusions and forecasts to the experts.

However, banking crises are a once-in-a-century event (we hope) and happily, most of us are unlikely to be around if/when the next bankers and politicians decide less regulation is a "good thing".