There are few top firms that will not have sent their marketing departments into overdrive with last week's news that financial institutions including Deutsche Bank, Barclays and Calyon are gearing up for panel reviews this year.

Deutsche Bank was the quickest off the mark – the investment bank began its wide-scale review of global advisers at the end of last year. Barclays is just starting its bi-annual review with an internal analysis of the performance of its panel firms over the last two years. It is predicted that submissions will be invited from firms towards the end of the month. HSBC is due to hold a similar exercise shortly and French bank Calyon, which has developed a reputation for punching above its weight in structured finance and infrastructure financing, has started its first-ever review.

Barclays is in some ways both the most and least interesting of the reviews. Only Royal Bank of Scotland, which recently completed its review, rivals Barclays as a generator of work for the UK's top 30, but the word from Canary Wharf is that the bank does not expect major changes this time around. Nevertheless, competition to get on Barclays' coveted seven-strong core panel will be intense. The bank is looking to consider pitches from 12 firms for the top roster. It will be a real coup for any new member to the club and even more of a blow to any firm that doesn't make the cut.

Not only do banks have a substantial legal spend – often around £30m annually – they also control a huge amount of corporate mandates. Barclays, for example, is estimated to control a legal budget of about £100m.

The reality of banking relationships

All this will be causing quite a stir throughout marketing and business development teams, and there is no doubt that banks in general are moving towards more rigorously formulistic panels. But the reality is many of the banks run their panels largely as a seal of approval of an existing relationship rather than as an opportunity to generate new ones.

The operations manager of one large bank says: "If we don't know you by the time of the review, we won't be instructing you. Why haven't we heard of you and why haven't you contacted us to establish a relationship with our business people?"

One adviser to Barclays says it spent three long years getting to know the bank before being successfully appointed to a sub-panel in a recent round. The firm attributes its success to an "ongoing brutally honest dialogue with the bank" and the intervention of the firm's management to show it was really focused on the client.

In addition, firms are being made to jump through more and more hoops to secure their places on the panel. Some firms take this to mean actively promoting the services of particular banking clients to junior lawyers. Banks will be invited into firms to roadshow current accounts, mortgages, loans and similar services. This might not sound like much but with up to 40 firms on some of these panels, this could amount to more than a thousand high-net worth individual private client accounts for the banks.

Another approach to the added value conundrum saw one firm painstakingly collate and present a list of data detailing things such as which banks were used by its lawyers in order to impress. Whatever next? Taken to its extreme, this could even prompt firms to start promoting banks to their corporate clients.

Of course, banks are entitled to ask a lot of their legal advisers. But given the size of many of these panels, it has to be questioned whether it is worth the effort for the firms. And amid the competition for a relationship with banks, it seems no-one has stopped to question the ethics of firms taking on this role at all.