Central Bank 'should have blocked property lending to avoid crash'

The banking crisis could have been avoided if the banks had not engaged in so much property lending, the banking inquiry has heard.

Central Bank 'should have blocked property lending to avoid crash'

The banking crisis could have been avoided if the banks had not engaged in so much property lending, the banking inquiry has heard.

Expert in banking policy Gregory Connor of Maynooth University is giving evidence at the Oireachtas Banking Inquiry this morning.

He said regulators and economists totally failed to heed the warning signs in 2006 and 2007.

He added the Central Bank should have stopped property lending, and also stopped so many foreign banks from investing their spare money in Ireland.

"The Central Bank and financial regulator should have blocked the enormous debt capital inflow and the too-fast growth in property development lending," he said.

"If it had done either of those things, in my opinion, the Irish banking crisis wouldn’t have happened - and it should have done both.

"There's a massive failure by the Irish Central Bank and financial regulator in not blocking both of these."

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