Banking failure - Leather boot needed, not kid gloves

The announcement by the Financial Regulator Patrick Neary last Friday of his decision to retire — following a critical report into the functioning of his office — highlights the need for a whole new culture in relation to banking in this country.

Whether or not Mr Neary actually knew about the secret loans to executives of Anglo Irish Bank, members of his staff certainly knew since January of 2007. The recent report blamed a breakdown in communication in the Regulator’s office for keeping Mr Neary in the dark about the outrageous conduct in Anglo Irish Bank, and thus, for not informing the Government when it was drawing up its rescue package for the banks last autumn.

Commenting on Mr Neary’s decision to retire, Finance Minister Brian Lenihan pointedly failed to thank him for his services, or to express any of the other niceties usually extended on such occasions. Mr Lenihan was reportedly furious that Mr Neary was unaware of the €87 million in loans to the chairman of Anglo Irish Bank, Seán FitzPatrick, who had the revolting audacity to complain on RTÉ early last year that there was too much regulation in Irish banking. Obviously there was not nearly enough regulation.