THE two international experts appointed to carry out one of the preliminary inquiries into the banking crisis will hold talks next week with officials of the Central Bank, the Financial Regulator and some of the country’s research institutions as their probe into the banking collapse gets under way.
They will identify institutions, including banks, where appropriate in their report, but will not identify individuals, they said.
Klaus Regling and Max Watson who worked together previously at the European Commission, met the Committee in Dáil Eireann yesterday afternoon when they outlined their aims for the inquiry and responded to a series of questions and submissions from members of the panel, including the three main opposition party spokesmen on finance, Richard Bruton, Fine Gael, Joan Burton of the Labour Party and Arthur Morgan of Sinn Féin.
Both confirmed their inquiry would stop at the end of September 2008 when the Government was forced in to rescue the banks.
They have no remit to go beyond that date and would not deal with the Government’s subsequent handling of the crisis. Their report is due to be completed by the end of May 2009.
The Central Bank Governor will report on the performance of the financial regulatory system in a separate report ordered by the finance minister.
Joan Burton asked if they would look at the circumstances surrounding the run on Anglo Irish Bank’s shares on St Patrick’s Day in 2008. She maintained that, if the authorities acted back then, while the crisis might not have been averted it might not have been as bad. It was important too that their inquiry looked at the impact the crisis has had on ordinary people, she said.
Richard Bruton of Fine Gale told the two global banking experts that what we are dealing with in this instance “is a bog standard property bubble” fed by “low interest rates, the free flow of capital and weak regulatory oversight”.
He traced the difficulties back to the setting up of the initial financial regulatory authority, whose own guidelines were not sufficiently rigorous to ensure the soundness of the financial services sector.
Mr Watson told the Committee he and Mr Regling hoped to come up with the broad “typology” of what went wrong in Ireland but would not be getting into the nitty gritty of bank deals or the behaviour or actions of certain individuals, which was not part of their brief.
© Irish Examiner Ltd. All rights reserved