Look to the UK and US for how to conduct an inquiry into banks
Any investigation must also highlight the role of those who did warn of impending disaster, writes
As National Indignation Week draws to a close following the Anglo Tapes revelations in the Irish Independent, it is time for a little perspective. Banks in their death throes worry only about liquidity and their time horizon foreshortens. Colourful language and nervous jocularity are not surprising. Nor is the complete absence of any alertness to the broader picture. The bad singing was the only real shock. Anglo Irish was a cooked goose in mid-September 2008 and the managers captured on tape must have known this in their bones.
A full banking inquiry is now inevitable. What does it need to address and how should it be organised? There is no need for another review of the macroeconomic background to the Irish banking collapse. The three reports already available, the Honohan Report, the Regling/Watson Report and the Nyberg Report, as well as various academic studies, provide an adequate account.
There are four critical areas in which available information is absent or incomplete. These are: the lending behaviour of the individual banks in the years leading up to the bust; the performance of overseers; the policy response from government; and the role played by international bodies, particularly the European Central Bank (ECB).