Outlook: Cruickshank makes an early exit from the stock exchange

Abbey National; Nissan/euro

The job of chairman of the London Stock Exchange is not what it used to be, as the present incumbent, Don Cruickshank, once seemed famously to confirm. The Stock Exchange, he said, was just another bog standard medium-sized company.

We all knew what he meant. Where once the LSE had been the epicentre of the City it had become just another trading platform among many, stripped of its power, position and prestige – a publicly quoted also-ran answerable to the higher authority of the Financial Services Authority when once it had been a governing City deity. Even so, it wasn't the most tactful of remarks for a new chairman to make. Other faux pas included the gloriously embarrassing leak of the exchange's media strategy for merging with the Deutsche Börse.

The Financial Times was to be spoon fed the story first, so as to get the press on side, and if for some reason the deal broke down, it would all be blamed on German intransigence and teutonic inflexibility. In fact it wasn't even a leak. The LSE press office, bless them, mistakenly faxed the briefing document to every news organisation in the land.

Enough tittle tattle. The merger failed and Mr Cruickshank was left having to perform a 180 degree about turn in strategy.

It was a bumpy start, but to be fair, things seem to have improved quite a bit since the Deutsche fiasco. Today the LSE has abandoned the idea of merging with Continental rivals and instead champions the cause of fair competition between exchanges. That requires a level playing field on clearing, settlement, listing requirements and stamp duty. Progress is painfully slow on all these fronts, despite the single European market, but it is so plainly the right approach that it is hard to believe, three years after the event, that the LSE could ever have been so stupid as to pursue a full merger with the Deutsche Börse. The cart was being put before the horse. It was an idea that was about 20 years ahead of its time.

After years of systems and operational turmoil, Clara Furse, the LSE chief executive, seems to have done an excellent job in making the Stock Exchange work for its users and customers again, and although the shares are well off their peak, the company is performing as well as anyone could have expected given the state of the markets. The LSE's failure to acquire Liffe, or to pull off an alliance with Nasdaq, is a disappointment, but at least the LSE is back on the front foot once more.

So why is Mr Cruickshank quitting, before even acquiring the gong that the job once routinely commanded? There's no row, or coup, Mr Cruickshank insists. With the battles in Europe for single, low-cost settlement and clearing mechanisms still to come, it seemed like the right moment to go. He's done the transitional bit. It is for someone else to do the next phase.

Step forward Sir Brian Williamson, who managed to sell Liffe to Euronext for a packet and must now find himself at something of a loose end. Many thought him the right man for the job when Mr Cruickshank got it. Perhaps his time has finally come.

Abbey National

Michael Soden, chief executive of Bank of Ireland, is feeling more than a little put out. Three weeks ago he approached Abbey National to suggest the two talk turkey. Since then he's hardly heard a dicky bird. Almost total radio silence even after yesterday's statement confirming planted weekend reports that he's interested in bidding.

We've got lots to offer, he insists. Why won't they talk to us? The most obvious reason is that having recently fired Ian Harley, Abbey doesn't have a chief executive and although Lord Burns is doing a sterling job holding the bridge, the ship is vulnerable and rudderless. This is not the moment to be dashing into marriage with the first offer that comes through the door.

The other is that Bank of Ireland is a fair bit smaller than Abbey National, both in terms of market capitalisation and balance sheet assets. What would be the sense of merging with Bank of Ireland? There would be some limited cost-cutting potential to be gained by folding Bank of Ireland's Bristol & West mortgage book into Abbey National's, but there is not much overlap elsewhere.

Bank of Ireland boasts strengths in wholesale banking and success in cross selling of financial products, but we've heard such claims before and in practice it is hugely difficult to duplicate cross-selling success between different countries. The Irish and British markets are fundamentally different.

As it happens, Mr Soden is not proposing a merger of equals, but rather a full-scale takeover bid, leaving no room for compromise on management, domicile, supervision or any of the other issues that undermined a similar attempt to merge with Alliance & Leicester a few years back. The new bank would have its primary listing in London but would be domiciled in Ireland and run from Dublin.

It's not impossible. Royal Bank of Scotland managed to acquire the much larger National Westminster Bank, but in that case the potential for cost cutting was much greater and the RBS management team of Sir George Mathewson and Fred "The Shred" Goodwin, was a more formidable and proven one. Lord Burns must give Mr Soden the chance to put his case, but in the end he might find it less complicated and ultimately of more value to his shareholders simply to find a decent chief executive.

Nissan/euro

Carlos Ghosn is a Frenchman born in Brazil who runs a Japanese company, which certainly makes him a polyglot but hardly qualifies him to pontificate on whether Britain should join the euro. Then again, the company in question happens to be Nissan, the UK's biggest Japanese inward investor, which obviously has a vested interest in whether the pound becomes part of the single European currency.

Nissan has been here longer than any other Japanese car manufacturer and is more exposed to the pound/euro exchange rate than any of its counterparts. Its Sunderland plant exports eight in every 10 cars it produces, almost all of them to the eurozone. Mr Ghosn's ruthless cost-cutting in Japan has turned Nissan back into profit, but in the UK the story is one of continuing losses, despite Sunderland's reputation as Europe's most efficient car plant.

Two years ago, Nissan very nearly pulled the plug on Sunderland by threatening to switch production of the new Micra to France. The plant's extraordinary productivity record in combination with a large Government bung eventually persuaded it to stay. Now Mr Ghosn is upping the ante once more with his most explicit hint yet that without the euro, there will be no further model replacements for Sunderland.

Inward investors, for all their high-profile investments, still make up only a tiny fraction of the UK's manufacturing base. Moreover, the attractions which first brought Nissan to the UK in 1984 – language, social costs, flexible labour markets, low corporate taxes and golf courses – are still here and in some respects are an even more powerful draw now than they were then.

When Nissan decided to commit to the long-term future of Sunderland by keeping the Micra here, it did so on the implicit understanding that before long it would be building cars in the same currency as it sold them. Two years on, the Government has yet to deliver. Businessmen who place their trust in politicians are often disappointed and perhaps in Mr Ghosn's case something was also lost in the translation – depending on whether he was listening in French, Japanese or Portuguese. This time around the message from government will need to be loud and clear otherwise Sunderland's goose looks well and truly cooked.

jeremy.warner@independent.co.uk