The report by the Central Bank Governor, Patrick Honohan, clearly indicates that the Irish banking crisis was caused by excessive land and property lending by the Irish banks themselves and he confirms that the failure of Wall Street’s Lehman Brothers was “not decisive”.
So in brief, although International pressure somewhat contributed to the intensity of our Irish banking crisis, the characteristic of this problem were mostly domestic. Mr Honohan also states that house prices had been dropping for some 18 months prior to the collapse of the now infamous Lehman Brothers, back in September 2008.
Patrick Honohan Central Bank Governor.
Speaking to Thurles.Info this morning, following the publication of the first reports into the causes of our banking crisis, North Tipperary Deputy Noel Coonan stated that independent experts have now confirmed that Brian Cowen and his Government were 100% guilty of gross failures in this country’s economic management and North Tipperary taxpayers are amongst those who have been left to pay the price.
Deputy Coonan stated:
“No matter how much spin Brian Cowen puts on the reports carried out by the Central Bank governor and International Banking experts, it has been affirmatively laid out in black and white that the banking crisis was not caused by Lehman Brothers, but by bad policy making decisions on our own back yard.”
In his report Patrick Holohan, said: “The weaknesses of Irish banks were not caused by the interruption of the flow of cheap money from abroad,” and he also commented: “Fiscal policy and budgetary measures aimed at boosting the construction sector, were significant factors in contributing to the unsustainable structure of spending.”
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