Bank crash ‘worst since Depression’

Ireland’s bank crash is the costliest and deepest of any economy since the Great Depression, according to an IMF report.

Ireland is the only country to suffer from all three of the following: Fiscal costs, increases in public debt, and output losses due to a banking crisis.

The IMF paper, entitled Systemic Banking Crises Database: An Update, by Luc Laeven and Fabián Valencia, says: “Ireland holds the undesirable position of being the only country currently undergoing a banking crisis that features among the top-10 of costliest banking crises along all three dimensions, making it the costliest banking crisis in advanced economies since at least the Great Depression. And the crisis in Ireland is still ongoing.”