Probe may focus on Anglo’s role in financial crisis

THE role played by Anglo Irish Bank in the banking crisis is likely to be included in the proposed inquiry into the financial meltdown, Minister for Finance Brian Lenihan indicated last night.

It had been suggested that the Commission of Investigation into the banking crisis, which has been initiated by Government, would only investigate banking matters leading up to the bank guarantee scheme, introduced at the end of September 2008.

However, Mr Lenihan indicated yesterday that he would consider widening the time scale of the investigation up to January 2009.

Such a move would take into account all the various controversial dealings and solvency/liquidity issues at Anglo Irish in the run-up to its eventual nationalisation.

During his address on the matter to a Dáil committee, yesterday, Mr Lenihan said it was clear there were particularly egregious failures in corporate governance and risk management at Anglo Irish Bank and Irish Nationwide Building Society.

“Certain matters are already the subject of investigation by the relevant authorities, but there is a need to examine more deeply and broadly what went wrong in these two organisations.

“The activities of the boards and senior management of these institutions – in particular the business models and strategies which resulted in those institutions experiencing severe financial distress – require to be fully investigated.

“I believe the public expects us to find out what went wrong and why, in these two institutions that have cost the taxpayer so dearly,” he added.

During the same meeting, Fine Gael and Labour’s finance spokespersons – Michael Noonan and Joan Burton – said a failure to broaden the time scale of the investigation would give the proposed commission no credibility. Mr Lenihan said that he intends to name his preferred candidate to head the investigation in the coming days.