On 18 January 2010, the Norton Rose Group published the results of its latest survey tracking market sentiment in relation to the global financial crisis. The big question that we face at this time is whether we can now put the global financial crisis behind us?

The mood of respondents in our fifth survey is noticeably more upbeat by comparison to previous surveys and the sense of optimism that pervades the survey suggests that many believe that we have indeed reached a turning point in the crisis. This is tempered with an appreciation that the aftermath of the crisis is continuing to be felt across the globe and that the possibility of a double dip recession remains.

Whilst the highest percentage of respondents predicted that the recovery will be long and shallow, there was a clear consensus that overall, the financial sector is preparing for a return to economic growth. A key requirement for sustainable economic growth is a return of liquidity to the global banking system. Two thirds of respondents believed that liquidity is back or will resume within nine months. Thirty-five per cent of respondents felt that liquidity would return between March 2010 and September 2010 whilst 29 per cent of respondents reported that liquidity had already returned.

The survey also showed a strengthening belief in the power of the Asia Pacific economies. More than three-quarters of respondents believe that the region will lead the global recovery. In addition, 68 per cent of respondents expect a permanent shift in economic power from West to East.

Apart from bankers, regulators have borne the main criticism for the financial crisis. One of the clear policy developments has been the move by regulators towards establishing global regulatory standards. However, as one respondent said, it makes no sense to try and set up a supranational regulator as long as the lenders of last resort remain national. This echoes the telling comment from the Governor of the Bank of England, that global banks are global in life but national in death.

It is almost certainly true that the situation is now more stable than it was 12 months ago and in the UK the Bank of England has decided against further quantitative easing. However, as recent events in Greece have shown sustained European recovery is not just around the corner. A huge amount of work now has to be done to rebalance the system in Europe.

The Norton Rose Group survey, Financial institutions in the future: Global financial recovery can be found here