This Tuesday she told the British Banker's Association the truth. Royal Bank of Scotland made the largest ever corporate loss last year and yet was still saved by the government with a massive £20 billion plus rescue injection. One might ask how such an institution, so fundamentally important for the economy, could not be?

Kroes does not dispute that. What she does insist on is that such aid cannot be effectively propping up the bank indefinitely, allowing the balance sheet, and hence the bank's business, to remain bigger than it should be, if it were not for that aid.

EC rules state that a restructuring plan to set out how this should be rectified must be made within six months of the aid being administered. After a while there is a danger that smaller banks, without aid, will be disadvantaged by their larger protected brethren.

Kroes is clearly losing her patience with the UK Government. The two camps have yet to resolve how Northern Rock will be restored to independence over 15 months after a draft restructuring plan for the UK's fifth largest mortgage lender was submitted.

It seems as if a similar delay could happen with RBS. However, that could be disastrous for Kroes as the UK government turns its attention to the forthcoming election. RBS is such a significant bank that there is a danger Kroes' authority will be damaged irreparably if no agreement can be reached on possible divestments.

With Germany she acted decisively agreeing a dramatic restructuring of Commerzbank and WestLB within the EC timetable.

So the next month, before RBS updates on its internal restructuring plans with interim results in early August, will be critical. An announcement on the sale of various RBS Asian businesses, possibly to Standard Chartered and ANZ, is expected imminently.

However, that is unlikely to be sufficient to satisfy Kroes, who wants to see RBS's dominant domestic position in UK corporate and smaller business banking broken up. Perhaps we will yet see NatWest and the Royal Bank separated. Bringing those brands together was disgraced former chief executive Sir Fred Goodwin's key deal.

After that Kroes will aim her sights at Ireland and her homeland of the Netherlands. Both states are propping up key lenders there. Kroes is due to visit Ireland for two days on July 16.

The group's culture might seem innocuous but it is important, particularly when Xstrata has this week proposed a “merger of equals” with South African stalwart Anglo American. Unlike many of its rivals, Xstrata's raison d'etre is doing deals, led by raucous chief executive Mick Davis.

The company floated in March 2002 with an initial value of £2 billion. Since then, a number of transformational acquisitions such as the $19 billion purchase of Falconbridge, and the recovery in global commodity prices, has meant the group is now valued at £20 billion. At its record high last year, when it tried to buy platinum producer Lonmin, it was worth £67 billion.

Xstrata's strength is that it has always been much closer to its customers than other, perhaps more parochial groups keener on looking after their employees. The presence of trading entity Glencore on its shareholder register, with a third of Xstrata's stock, is testament to this.

Davis's true loyalty showed earlier this year when he effectively enabled Glencore to retain this stake, by funding its participation in January's £4.1 billion rights issue, via a side deal selling certain Glencore coal assets in Colombia to the group for $2 billion.

The current tilt at Anglo American, now worth £24 billion, looks a deal too far for Xstrata. For one, Glencore looks likely to be diluted down to a sixth of the combined group, as the proposal currently lies. Secondly, Anglo American will vigorously defend its independence, as it is already showing, helped by implicit South African support.

Glencore must have approved Xstrata's move but that in effect puts Xstrata in play, if it is indeed willing to effectively relinquish control. That is highly significant. The end result might either see Anglo American making a “pacman” offer for Xstrata to defend itself or else encourage Vale, which has approached Xstrata before, to make a play for it.

Ultimately Xstrata, with few political connections, looks the more vulnerable participant in this process.

This deal, with its maze of myriad related smaller transactions, has been all about vested interests. The Government would be forced to support workers made redundant if the business was not saved. Banks would take a harder hit. And suppliers, such as Magna, GM's biggest, rely on the business continuing to save their own significant workforces.

That leaves little left for investors. In theory chapter 11 should allow GM to focus on how to cut its cloth, free of such parties desiring a quick return on their investment. GM might then become a leaner machine, better able to cope with the tougher economic outlook. Can the Obama administration make the necessary cuts to achieve this?

Unlike with Chrysler, there is no Fiat waiting in the wings to teach GM what to do. However, the company has already said going forward it will focus on four US brands: Chevrolet, Cadillac, Buick and GMC. The others - Pontiac, Saturn, Hummer and Saab - will either be scrapped or sold, with attendant plant closures, by the end of the year.

Finding a solution for GM's European businesses, although tricky, has proved less tortuous. Ultimately, production can be moved east to cheaper locations. That's the essential offer provided by Magna, however much it is couched in terms of saving jobs in European Union locations, principally Opel's heartland Germany. Fiat couldn’t compete.

Magna, which is more active in Europe than North America, has links with Russia already. Last September Russian industrialist Oleg Deripaska reluctantly offloaded his stake in the Canadian car parts provider to his creditors. However, he remains in control of Russia's largest automaker Gaz, which has plans to beef up its car making capabilities.

Opel's largest shareholder will be Sberbank, Russia's biggest bank, which is state controlled. Undoubtedly much business will be transferred to Gaz to the benefit of both Sberbank and Magna. GM's restructuring in Europe has some industrial logic, with the company's leading supplier, with most to lose, effectively engineering the rescue.

(PHOTO: Jounalists gather outside Bankruptcy Court in Manhattan ahead of GM's bankruptcy filing)