There is no doubt that Anglo Irish Bank has poisoned the well of this country’s banking sector and also its economy. What happened at that bank led to the making of the decisions that were announced yesterday in the Dáil. I do not accept, however, that this issue can be reduced to alleging wrongdoing on the part of certain named individuals. I agree with people who state that in so far as wrongdoing is found to have occurred, those involved should be brought to book. I would be as strong as anyone in advocating that this should happen.
It is part of an emerging narrative, particularly on the part of the Government, to seek to reduce this problem to the proverbial small number of bad apples. I do not accept that when considering what occurred in the past ten to 12 years, it is possible to reduce the wrong that has been done to the people as something which resulted from the actions of three, four or even half a dozen wealthy, or formerly wealthy, individuals. We would be doing a real disservice to the people and this country’s history if we insisted, even for one minute, that this was the case.
There is a great word which continues to be bandied about in respect of the banks, particularly Anglo Irish Bank, namely “systemic”. I am extremely interested in the use and abuse of this word. Like everyone else, I have a reasonable understanding of what it means in the English language. However, it has been employed by the Government, particularly in the context of Anglo Irish Bank, in the same way that Americans use the phrase “Too important to fail”. As I understand it, if a bank is of systemic importance this means its tentacles and those of its business reach so far into the heart of the economy that if it got into difficulty it would, by necessity, have to be saved.
I am intrigued by the statements made in the past 24 hours to the effect that the contents of the balance sheet of Anglo Irish Bank constitute half of the value of the Irish economy. I had not previously come across such statements. In fairness to the Government, if what is being stated is true then this would point to the importance of Anglo Irish Bank being somewhat systemic in character. Is it truly the case that the contents of one relatively young bank could constitute half the value of the country’s economy? If the answer is yes, how was this allowed to occur? In a country where people were previously informed that competition and the plurality of banking services were extremely important, how was such a position allowed to develop? There is a need for someone to clarify the position, particularly in the context of the absence of regulation for such a long period. How did the contents of Anglo Irish Bank’s balance sheet come to constitute such an enormous part of the economy?