Mr. Derek Quinlan:

Thank you, Chairman. Good morning, Chairman, and inquiry members. I have furnished the committee with a written statement in accordance with a request made to me. I don't intend to quote from this statement but will welcome the opportunity to make some additional comments to the inquiry.

It may be of assistance if I begin by providing the committee with a short introduction of myself so that I may outline my financial background and experience. In 1970 I graduated from University College Dublin with a bachelor of commerce degree. Subsequently I trained at Cooper Brothers and Co., now known as PricewaterhouseCoopers, where I qualified as a chartered accountant in 1973.

While at Cooper Brothers and Co., I worked in their tax department. In 1975 I successfully applied to the Civil Service Commission and became an inspector of taxes, where I stayed for six years. In August 1981 I was made a tax partner at John Woods and Co., now known as Grant Thornton. In May 1986 I formed Quinlan Ryan, a small chartered accountancy firm, with two partners, and the firm remained in existence for three years. In May 1989 I commenced trading as a chartered accountant under the title "Derek M. Quinlan, Chartered Accountant". In 1990 I put together a deal to purchase a number of units in the recently opened Square shopping centre in Tallaght, Dublin. This was my first significant property deal on behalf of clients. Other significant investments took place during the 1990s, including an investment of approximately €250 million in the IFSC.

The committee will have noted from my statement that I refer to the ... the activities of Quinlan Private, as I was asked to provide a statement regarding my company. I believe it is important to note that I would have personally invested in a large number of the investments put together by Quinlan Private. I would also have invested personally in other investments. The committee has, I'm sure, at this stage heard from other witnesses that, with hindsight, the growth in the Irish property market from 2001 to 2008 was enormous. It is now clear, for a number of reasons that were then unknown to me - and, I believe, to the majority of people at that time - that this growth was unsustainable. I genuinely did not believe that the market was in danger of collapse until I heard of the fall of Lehman Brothers in September 2008.

In my opinion there are three key areas which I feel are important in the context of the inquiry. During the period 2002 to 2007 there was a huge "feel good" factor in play in Ireland and most people bought into this reality, including myself. There were very few opposing views. This was just not an Irish phenomenon, it was actually international. In his book The Map and the Territory, published in 2014, Alan Greenspan, the former chairman of the American Federal Reserve said:

The Federal Reserve['s] ... highly sophisticated forecasting system did not foresee a recession until the crisis hit. Nor [he continued] did the [...] forecasting model developed by the [...] [IMF], which concluded as late as spring 2007 that [the] "[...] economic risks had declined since September 2006 [and that] [...] signs everywhere were encouraging."

The second point I'd like to make, I did not realise that the long-term bank finance being provided by the Irish banks was being funded on short-term borrowings from international banks and others. This model was clearly not sustainable. If I had known this at the time, I certainly would not have invested in Irish property. Finally, I was not aware - and I believe that most people were not aware - of what was going on internationally with sub-prime lending in the United States. This had, I believe, a huge impact on both the Irish and international banking sector, as liquidity dried up in a very short period of time.

I believe it's important to note that Quinlan Private invested in quality commercial properties. These were in prime locations. I have a fundamental philosophy in relation to property investment which is based on four main tenets: location; timing; liquidity; and confidence. It is clear, in Ireland, that, at the one time, all of these factors were decimated. I did not foresee this. I don't believe it would have been reasonable to do so. Neither the Irish banks nor the Ministers for Finance nor the Economic and Social Research Institute knew that the banking crisis was imminent. Rather, all parties envisaged a very bright future for the Irish economy and the Government of the day continued with high expenditure to fit in with that forecast.

I would like to conclude by taking this opportunity to state that I am deeply saddened at the fallout from the banking crisis. I recognise that, for a very large number of people in Ireland, it has had an unprecedented and devastating impact.