On 1 March 1996 the LAC considered EH's position on the total demolition of the Baltic (prompted by Trafalgar, who had lined up Citibank as a possible client for the site; they were reported as saying that if EH was favourable they would approach "an architect of international repute" to design the new building).

The LAC was told by Peter Drury, then Director of London Region, that it would be very difficult to find a buyer for the GMW scheme in then current market. Apparently, the Exchange Hall pushed the trading floors uncomfortable high and "banks nowadays are uncomfortable with the grandiose image which classical or baroque buildings present." It is certainly true that the GMW scheme was undoubtedly a very poor scheme.

The LAC was also told that during dismantling, the Exchange Hall's marble, plaster, floor etc was found to be in far worse condition than had been previously realised and therefore restoration would "be moving much closer to replication than reconstruction".

It was also revealed that "initial discussions have indicated that if a deal was struck with Citibank, Trafalgar House would be prepared to offer some considerable part of the windfall profit (at least £10m) towards the conservation of other important listed buildings"; Drury suggested this be the City churches, citing a precedent at Asheham House in East Sussex.

However, he said "in considering whether to accept total demolition of the Baltic, any potential benefit to other buildings should be set aside, lest an impression be given that LBC for demolition in the City is "for sale"". You're not wrong!

Drury also dismissed any argument that the demolition of the Baltic would have wider benefits to the national or regional economy - "Citibank are committed to remaining in London and it would make no difference to either London or the UK economy of they located at either of their two alternative sites, Canary Wharf and London Bridge." This argument equally holds true for the subsequent Swiss Re interest.

On this advise the LAC resolved, "that it would be reasonable to consider, in principle the loss of the remains of the Baltic Exchange in the context of a scheme which provided a new building of high architectural quality at significantly reduced bulk compared to the consented scheme."

This became the basis of EH policy, re-iterated in many subsequent EH letters. It was the crucial turning point and effectively prevented the City from continuing to insist on restoration of the Baltic - if it had the applicant could have taken it to appeal and won easily. It therefore effectively doomed any subsequent attempt to save the Baltic to failure.

However, the conclusion that the building could no longer be restored meaningfully is a highly questionable one. Decisions on whether buildings can be restored or whether that work will in fact amount to replication are not made on the basis of an exact science. They are subjective judgements dependent on many variables, such as attitudes towards the philosophy of restoration and the importance of restoring every single element. For example, much of the damaged marble lining could be reinstated, but - stained, fractured or perhaps incomplete - it could not be put back in "as built" condition. EH appears to have taken the view that, therefore, all of this damaged lining would have to be replaced. However, as the City planning officer put it in his report, "a greater number of battle scars may be more acceptable to some than others".

Others agree. Donald Insall Associates in a letter to the London Evening Standard on 29 Aug 2000 said the building could be restored; so did the applicants in their Environmental Impact Assessment. The City planning officer himself said so in his report, when he cited Windsor Castle, Uppark and war bombed City churches as examples of building s that had been restored folowing more extensive damage than the Baltic had sustained. He concluded that a "thorough and informed rebuilding could be achieved if there was a will."