Sunday 15 September 2019

Paper's 'banana republic' tag for Ireland gets under minister's skin

Ralph Riegel

RECENT banking scandals ensured Ireland's international reputation took a hammering at the hands of foreign media.

However, Finance Minister Brian Lenihan yesterday angrily hit-out at report's portraying the country as "a banana republic".

He claimed Ireland is no different from other countries caught up in the global financial difficulties including the UK.

The Financial Times labelled Ireland a "banana republic" after the Government was forced to recapitalise its major banks -- just days after a controversy erupted over loans to one senior Irish bank boss that were shuttled between two financial institutions for almost eight years.

But Mr Lenihan insisted the description was unwarranted and unfair.

"I don't accept that (claim) for one minute," he said.

"If the Financial Times took the mud out of their own eyes as to what has happened in the UK in the last year and where the Royal Bank of Scotland, one of the largest banks in the country, had been taken under effective State control -- I don't think the problems in the banking sector are unique to any one country."

Minister Lenihan said very few countries have been left unscarred by the financial fall-out from the problems initially sparked by US sub-prime lending.

Regulatory

"Problems with regulatory control, problems with reckless lending, problems with paper transactions being misrepresented as real money transactions -- these have characterised the world banking system," he said.

"There is nothing unique in what has happened in this country -- and, indeed, we haven't had all of the failings that have been demonstrated in some overseas banks.

"That is not a particular cause for pride but it doesn't entitle us to be so described by the Financial Times," he said.

Minister Lenihan said that Ireland would continue to respond to the financial challenges in a prudent, effective manner that would ensure confidence was retained in the Irish economy and financial services sector.

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