Challenger banks will never prosper while this political posturing prevails Third, this was a sale enforced on Lloyds Banking Group by the European Union following the taxpayer-funded bail-out. Like a child being told to part with a once favourite toy, Lloyds did so reluctantly and with as few sweeteners as possible. The deal's failure is not good for Mr Marks, a Co-op lifer who retires next month and who had hoped that this transaction would be a final glorious chapter. But biting off more than he could chew in this instance should not obscure the fact that in much of the rest of the business Mr Marks has introduced some proper market disciplines for which the board should give thanks. The collapse also raises serious questions for the Treasury; it was so keen on a deal with a "nice bank" that there was always a danger politics would overwhelm commercial sense. An IPO will, happily for the Government which is a 39pc stakeholder, almost certainly value the asset higher than this trade sale. Finally, for all those who dream of a nation of small regional banks serving motherhood and apple pie, it is worth remembering that scale is a necessity in banking. As long as the ridiculous political posturing and never-ending regulatory and capital arms race continues, challenger banks will find it almost impossible to actually challenge. Thorntons" revival offers hope to the high street When Thorntons warned last January that Christmas sales had been worse than expected, there were genuine fears for the future of the high street retailer. The company had already issued five profit warnings in the previous 20 months, and shares in Thorntons slumped by almost a third. Few would have given it much chance of surviving beyond Easter. However, since then, things have improved substantially. While Clinton Cards, JJB Sports, Comet, HMV and Jessops have all gone to the wall, Thorntons has actually increased sales. Shares in the company are now worth 80p, compared with 10p in those dark January days. For investors that stayed loyal to Thorntons, that increase must taste as sweet as the retailer's chocolate. How has it staged such a recovery? The short answer is that Thorntons has transformed the shape of its business. Since joining in 2011, Jonathan Hart, the former boss of Caffe Nero, has branched out from its traditional stores; as well as closing up to 180 high street locations over three years, he has sought to grow the company's sales within supermarkets. The result of this strategy has been that Thorntons now sells more chocolate to supermarkets than in its own stores, with group sales increasing as a result. At the same time, Thorntons has focused on presenting its products as gifts rather than an everyday treat. The risk of offering Thorntons products to supermarkets is that it damages the brand - but so far it has worked a treat. The strategy has worked precisely because of the strength of the brand; customers in Tesco have been picking up boxes of Thorntons chocolates to offer to family and friends on special occasions. Although the wholesale business could slow down, Thorntons is clearly on a firmer footing than a year ago. It shows that struggling high street retailers have the ability to revive themselves. Sports Direct is another example. Five years ago its shares were worth 32p, on Wednesday they cleared 450p. Mike Ashley's retailer has undoubtedly profited from the demise of JJB Sports, but the company is also benefiting from introducing an imaginative share bonus scheme for 2,000 staff in its high street stores, which has proved a powerful motivator. For retailers, necessity is the mother of invention. It is also the key to survival. Bundesbank boss gets caught offside on FTT With Bayern Munich's demolition of Barcelona on Tuesday night another reminder of their footballing prowess, it's not very often that you expect the Germans to score own goals. But that could be one way of describing Jens Weidmann's comments about the planned Financial Transaction Tax, which he said could raise the cost of borrowing for commercial banks and have negative unforeseen consequences. "Thanks a lot Jens!" they must be saying in Angela Merkel's Chancellery, for her government might have expected the president of the Bundesbank to be 100pc behind the tax. It is supported by Germany and 10 other countries, but fiercely opposed by the British Government and in this paper as an attack on the City. The planned tax is now the subject a legal challenge in the European court by Britain and Weidmann's observation that the costs to European governments could outweigh any potential revenue could pretty much make the opening argument. With friends like Jens, Germany might have its work cut out to shore up an untypically leaky defence.