Following the collapse of Lehman Brothers, many thought that we were about to witness a second Great Depression. That did not happen, in large part because policymakers had learned some of the lessons of the Great Depression. Nonetheless, the advanced economies were put through severe economic and political tests.
Improvements in prudential regulation and supervision of banking systems, in large part based on well learned lessons from past banking crises, merit special mention. Banking crises of the past led to important lessons. The shift towards accepting and acting on these lessons began in the late 1980s, but gained its full impetus only after the Mexican financial crisis in 1994-95.