The fallout from the report into the collapse of Lehman Brothers shook Wall Street and London on Friday as US officials grilled banks about off balance-sheet trades and questions were raised over the City’s role in the company’s attempts to cover up its problems.

The 2,200-page report by Anton Valukas, appointed by a US court to probe the reasons for Lehman’s failure in September 2008, paints a damning picture of the bank’s top management, including former chief executive Dick Fuld, three of its chief financial officers and auditors Ernst & Young.

Its conclusions – that there is credible evidence against Mr Fuld and others for breach of their fiduciary duties and against E&Y for professional malpractice – are also a further blow to the battered credibility of the entire banking industry.