Sir, – Given that the discussion in these pages as to who was responsible for light-touch banking regulation precedes a much-vaunted public banking inquiry, it may be worth considering what the then governor of the Central Bank and Financial Services Authority of Ireland, Prof Honohan, had to say when preparing a preliminary report for the Commission of Investigation into the Banking Sector in Ireland (which reported in 2011).
While comment here and elsewhere credits Charlie McCreevy, Mary Harney, the McDowell Group, and the general world-view of the Progressive Democrats, with ushering in a game-changing light-touch philosophy via the creation of a semi-independent financial regulator in 2003, the Honohan report does not necessarily bear this claim out.
Rather, Prof Honohan’s report found that the “general approach of the [financial regulator] did not mark a change from that of the [Central Bank] which, prior to the creation of the [financial regulator], had had statutory responsibility for the supervision of banks. Rather, the approach of the [financial regulator] was, in essence, a continuation of the custom and practice of the [financial regulator].”
Indeed, the enforcement strategy inherited by the Financial Regulator from the Central Bank was described by Prof Honohan as “Walk softly and carry no stick”.
These conclusions do not absolve the financial regulator’s office or the government of the day of responsibility for what happened in the Irish financial sector, but should remind us of an old tenet of political journalism – presume cock-up before conspiracy. – Yours, etc,
SEÁN Ó SIOCHRÚ,
The Village,
Glenbeigh,
Co Kerry.
Sir, – Vincent Browne (“Banking inquiry of a different stripe required”, Opinion & Analysis, May 7th), regarding the forthcoming Oireachtas banking inquiry, asks “what we need to know most was how we bought into the culture of ‘light-touch’ regulation”.
Might I suggest that at least one of the reasons concerned the ingrained culture of “light-touch journalism” prevailing in our country at the time? – Yours, etc,
DECLAN DOYLE,
Lisdowney,
Kilkenny.