Belfast Telegraph

Bank probe 'to shine light on past'

An inquiry into the collapse of the banking system will illuminate a dark period of the country's past, the head of the investigation has said.

The government guaranteed ailing banks in 2008, a decision which eventually led to a 64 billion euro rescue of the financial system and an international bailout of the state.

A parliamentary committee in Dublin is looking at banking, regulation and crisis management by authorities, before publishing a final report in November.

Committee chairman Ciaran Lynch said: "It is an opportunity to shine a light on a dark and painful recent time in our past, an opportunity to piece together the events of that time, an opportunity to learn from the mistakes that were made and an opportunity to ensure that those mistakes are not repeated."

Peter Nyberg, a former IMF economist and Finnish government banking official, was questioned by a group of 11 legislators on his 2011 government-commissioned report into the crisis.

He said the Government had taken the safe option in deciding to bail out the ailing banks following a property price bubble.

"When decision-makers are faced with that situation, what one tends to do is take the safe decision even though afterwards it might not seem so wise, and that is what I think the Government did."

He said he understood but did not necessarily condone the move.

"It is a culmination of a lot of mistakes that were made before but the mistakes were not made on that night, the mistakes were made several years before and not only by the Government but really by everyone else."

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