Central Bank aware of property bubble from 2004 - ex-employee

Banking inquiry: Former finance boss claims bank withheld information from Oireachtas

Central Bank building in Dublin. Photograph: Matt Kavanagh

The Central Bank was aware of a property bubble from early 2004, a former employee has claimed.

In a written statement to the Oireachtas banking inquiry, Frank Browne makes a number of claims about the bank's knowledge of an impending crisis.

Mr Browne, head of the Central Bank’s financial stability unit (FSU) between 2003 and 2010, said his department was warning of the risks in the banking and construction sectors.

In the statement he will claim the warnings were toned down or ignored by the bank because it wanted everyone on the right message, leading to key information being suppressed.


Mr Browne's statement will also allege a large amount of information was not given to the 11-person inquiry, chaired by the Labour Party's Ciarán Lynch.

The statement will be published today on the banking inquiry's website with correspondence from developer Johnny Ronan and David Murray, former treasury manager at Irish Nationwide Building Society.

They will be the last three written statements released by the inquiry before it begins the work of compiling its final report.


Meanwhile, the inquiry has withdrawn its direction to former Irish Life & Permanent executive

Peter Fitzpatrick

to provide a written statement to the committee following an intervention by the

Director of Public Prosecutions


The inquiry had decided on September 3rd to maintain a direction to Mr Fitzpatrick to provide a written statement to the inquiry.

However, Mr Fitzpatrick, who is the subject of criminal proceedings by the State, then applied to the DPP for a declaration under section 72 of the Houses of the Oireachtas (Inquiries, Privileges and Procedures) Act that the committee withdraw is direction to him.

“Having considered the lines of inquiry on which the committee directed Mr Fitzpatrick to provide a written statement, the DPP said the evidence sought by the committee could reasonably be expected to prejudice the prosecution of Mr Fitzpatrick and issued a declaration to . . . to withdraw the direction,” a statement from the inquiry said.

Financial crash

Mr Fitzpatrick, who is 61 and lives in Malahide in Dublin, was finance director of IL&P at the time of the financial crash in 2008.

He is one of four former senior bank officials facing criminal proceedings in relation to an alleged fraud involving Anglo Irish Bank, Irish Life Assurance and Irish Life & Permanent in 2008.

The others are Willie McAteer, a former finance director of Anglo, John Bowe, who was previously head of capital markets at Anglo, and Denis Casey, a former chief executive of IL&P.

On September 1st the inquiry announced that it had withdrawn its direction to Mr Casey to appear before the committee following an intervention by the DPP.

The committee said it would not publish the written statement that Mr Casey had submitted to the committee pending further consultations with the DPP.

The DPP had earlier intervened to prevent Mr McAteer and Mr Bowe from appearing as witnesses at the inquiry on the grounds that it could prejudice criminal proceedings against them.