The great German funding myth

Matt Cooper says during the property bubble “money poured into this country’s banks” from institutions in Germany and France (Opinion, Dec 27). In saying this, he is lazily rehashing a claim which is often made, but is also entirely false.

In their report last September, “Profiling the Cross-Border Funding of the Irish Banking System”, the Central Bank found that just 1% of foreign lending during the boom came from Germany. Institutions in France contributed even less, just a fraction of a percent of the total. Several other studies by the Central Bank and by independent economists have shown likewise.

So why is it constantly repeated, as a matter of established fact, that enormous levels of German and French lending to our banks took place during the boom? And more to the point, why do commentators like Matt Cooper persist in spreading this nonsense instead of challenging it?