PHILIP Lane hasn’t barked in recent days. He hasn’t shown any teeth. He hasn’t read the riot act to the banks for the benefit of the public.
He has not, as might be expected of the bank watchdog, made any real effort to demonstrate that he is gunning for deceitful bankers who have had a devastating impact on the lives of thousands of customers.
The public expectation for anger and action from the governor of the Central Bank on the matter of the tracker mortgage scandal is understandable.
On one level there is a sense of disbelief about what has occurred. After all we’ve been through — reprobate bankers dragging the country to the abyss; bailing them out; enduring huge pain as a result — and they repay us with a swift return to the kleptomaniacal ways?
Anger is the most natural initial response. The public want heads. They want these people removed from their jobs, and, if possible, facing prosecution. And the public wants it now.
In such a milieu, there is a hunger to see the anger reflected back at us from the main policeman in this area, the governor of the Central Bank.
Politicians understand this sense of want. They have been responding in kind, giving good anger across the floor of the Dáil, across the airwaves, across all media. If it’s anger you want, these boys and girls can go all day and night.
Not, it would seem, however, Philip Lane. His public appearances have been less than reassuring. He speaks softly but does not carry a big stick, although he may have one locked away somewhere in Central Bank HQ.
He gives the air of heading up an entity which, as characterised by Pearse Doherty last week, has all the appearances of “the dog that doesn’t bark”.
On the steps of the Department of Finance on Monday, he said the vast majority of those impacted would be recompensed by Christmas.
Then he said this: “It is up to the banks to make fair and generous offers to those affected so that the full scale of the harm is remedied.” Hardly the fare that is likely to have bankers quaking in their boots.
The governor demonstrating anger is about more than responding gratuitously to the public mood. It’s also about instilling confidence that the banks will not be allowed to either deceive or rob unsuspecting members of the public or to recklessly drag the country into the abyss once more.
It is about reassuring people that the institution that polices the banks is up to the job and doing it on behalf of not just the macroeconomic interests of the country, but all of its citizens.
In that regard, Lane has not performed well in recent weeks. Nobody wants a governor who’s all style and no substance. But in the current environment, the office does require some degree of empathy to reflect the role emotion now plays when it comes to the impact of crooked banks.
Lane is regarded as the finest economist of his generation. He was a popular choice for the job. Like his immediate predecessor Patrick Honohan, he came from academia.
Before Honohan, the governor’s chair was predominantly filled from the Department of Finance, leading to criticism that its independence from permanent or elected government was highly questionable.
Lane is part of the new deal to bring in outsiders, but in his failure to properly account for the public mood, he has the cut of an insider.
So much for the anger from the governor. The actions that he and the Central Bank have taken have also come in for criticism. An investigation into what was going on was only launched in December 2015, despite the issue coming to light years earlier.
In light of all that we know about the capacity of bankers to be duplicitous, in light of all that befell the country, the watchdog should have got cracking long before then.
Was the slow start an example of the old-style deference that the Central Bank, and its previous consumer arm the Financial Services Regulator, showed to banks?
There is also reason to give credit where it is due. Lane has made the point that recompense for victims is the first priority. To that end, 7,700 were reimbursed by 2015 and another 3,300 since, to the total tune of €160m.
There is at least as many again due to get their money back, but once the regulator cranked into action, the pace has been commendable.
So far, precious few of those reimbursed have publicly made an issue about the process or the level of compensation. This suggests some level of satisfaction with how things have been handled, although that can change at any time.
Extending the carrot rather than wielding the stick would appear to have worked best for the victims of this scam. If Lane were to venture down the legal route, the victims would be a long time waiting.
Equally, if he were to invoke the powers to demand compensation, granted in 2013, he would likely face legal resistance in dealing with the cases that pre-dated those powers.
None of that will satisfy the mood for retribution, but it is difficult to argue with his approach if the first priority is to achieve recompense for the victims.
There is also an issue as to whether there was criminal conduct, particularly the possibility of collusion between the banks. That is primarily a matter for the gardaí now rather than the regulator.
Lane’s response to the scandal has thus been found wanting but what he lacks in the front-of-house duties may well be compensated for by his actions behind the scenes.