There are at least five ways of saying, “with the benefit of hindsight”. We know because Sir Tom McKillop, the chairman of Royal Bank of Scotland, wheeled out all five in his apology to shareholders yesterday. A once mighty institution has been all but destroyed and is still breathing only because of the promise of £20 billion of public money.

The buck stops with the chairman, Sir Tom admitted, and at last said sorry – three times. Sir Fred Goodwin, the outgoing chief executive, also finally uttered the S-word.

Arrogance, ambition, hubris and a stubborn refusal to listen to more cautious counsel all contributed to the bank’s downfall. Unless there is a dramatic improvement in investor sentiment, RBS shares will remain below the forthcoming 65.5p rights issue price and therefore the Treasury will have to cough up the entire rescue financing and become the controlling shareholder. RIP RBS as an independent, privately owned organisation.

In the financial services menagerie, banks are the ultimate protected species. They cannot be allowed to expire. The consequences of a bank the size of RBS dropping off its perch are unthinkable. RBS is being rescued, and will be rescued again if that £20 billion proves inadequate.

The same applies in spades to Citigroup, which until very recently was the biggest bank in the world and still boasts liabilities of $1.9 trillion. Citi has already been shored up with $25 billion courtesy of Uncle Sam. The nose-diving share price suggests many doubt this will be enough.

Big banks will almost always be bailed out. But what about insurers? Insurance failures too can cause financial panic. Some are so plugged in to the wider financial world that, like AIG of the US last month, they too have to be propped up regardless of cost.

Sliding share prices are once again exposing the potential vulnerability of UK insurers. Aviva, Prudential and Legal & General headed the leaderboard of blue chip fallers yesterday on fears that their balance sheets may not be solid enough to withstand a prolonged bear market.

Whisper it softly, but the Pru is languishing at a 16-year low. The insurers insist that they still have decently plump capital cushions and can withstand much more brutal markets. They insist that there is no need to force them to accept public money in the manner of the banks. Let us hope their solidity is never put to the test.

Meanwhile, the contagion is spreading to beasts with no protected status. No one is going to lift a finger to save fund managers and they are having to cut their cloth accordingly, hence the heavy job losses now being forecast. In that corner of the financial services zoo, the keepers will not be rallying round with emergency bananas.

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