Wednesday 17 January 2018

State's role in Banana Republic chapter is what's really worrying

Anglo Irish Bank
Anglo Irish Bank
David McWilliams

David McWilliams

In my 2007 book 'The Generation Game', I wrote "Anglo Irish bank is little more than an out-of-control hedge fund leveraging themselves and their clients into property". The lawyers for the publishers insisted that the name Anglo be dropped, for fear of litigation. So the published sentence replaced the words Anglo Irish Bank with the more general "certain well-known Dublin banks".

And it wasn't just me; many others had concluded this about the Irish banking system, yet the authorities did nothing.

Looking at the Anglo trial, one thing that really stands out was the complicity and the knowledge of the State in this illegal act. It has been truly breathtaking to see that the main financial institutions of the State – the Central Bank, the Financial Regulator and the Department of Finance – were all aware that Anglo was lending money to people in order to ramp up its share price artificially, but did nothing. Yet they were happy to continue to describe the banks as "well capitalised" right up to the end.

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