Lenihan claims cost of banking crisis has been exaggerated

FINANCE Minister Brian Lenihan has suggested the cost of the banking crisis and its impact on the economy overall have been exaggerated.

Mr Lenihan made the comments when answering questions relating to the advice from consultancy group Merrill Lynch that the banks should not be guaranteed.

Mr Lenihan said the Government received a range of advice on the issue, part of which was that no bank should be allowed to fail and that the subordinated debt in Anglo should be “guaranteed” because it was one of the most vulnerable of the banks. In the end the Government guaranteed the subordinated debt of Bank of Ireland and AIB as well.