Professor Patrick Honohan:

The regulator should have known. It happened in many other countries, just not on as large a scale. The regulator was following a type of approach which I think of as the London approach. It is the sort of approach that was being adopted in the FSA in London. They had big problems with their banks as well, but nothing that they could not absorb, whereas our one was far too big. There was a scale difference. Maybe at a certain point, when the numbers got so big in relation to the economy, the wider systemic risk people should have said, "I do not care what you say about the balance sheets of the banks, that they have got enough capital. This must contain too big a risk. This has to be reined in." They did not do it.