Straight-talker to get to nub of crisis

THE 59-year-old German economist just appointed by the Government to investigate the cause of Ireland’s banking crisis, is known in Brussels as a straight-talker.

Klaus Regling is a hawk in economic matters, he has wide experience in working in institutions and in the private sphere.

His technocratic style and ability not to mince his words is likely to result in his telling the Government more than they might like to hear, former colleagues say.

A firm supporter of the free market, he is expected to find the situation in Ireland and in its banking sector was too free with not enough checks and rules in place. It is inevitable that the role played by the state and its policies will form part of the background to his investigation.

Those who know him in Brussels describe him as a hard-nosed economist and from his years with the International Monetary Fund he favours taking tough medicine to cure economic ills, irrespective of the pain it inflicts.

Mr Regling began his career 35 years ago with the IMF in Washington before returning to Germany where he spent a time working with the German Banker’s Association before joining the German Ministry of Finance.

After a further six years with the IMF in Washington and Jakarta, where he headed the Asian section, he returned to the German finance ministry where he spent a decade helping prepare for economic and monetary union.

He returned to the private sector as managing director of the Moore Capital Strategy Group in London, part of the macro hedge fund Moore Capital.

When the then president of the European Commission, Romano Prodi, decided to pick the best person possible as director general for economic and finance affairs rather than be subject to political pressure from member states, his search turned up Mr Regling.

During his seven years in the post he helped oversee the introduction of the euro and the rules and regulations build up around it.

As well as being in the hot seat when the Commission warned Ireland’s then finance minister Charlie McCreevy that he was in danger of overheating the economy, the Commission threatened to get tough on France over its deficit.