Professor Patrick Honohan:

By September 2008, the Irish financial system and economy had been placed in a situation of extreme vulnerability to any shock such as Lehman Brothers. Although we tend to think that, because our situation was so severe, we were the only people affected by the crash that followed the collapse of Lehman Brothers, it had an effect on countries that had not put themselves into such a situation. However, our vulnerability meant that the collapse in construction activity, tax revenues and the imbalance in the public finances as well as the €40 billion cost to pay for the losses that had been built up over a number of years before it, was much more severe. We would have ridden out the collapse of Lehman Brothers with a much milder situation had we managed to avoid all those errors.