Dr. Peter Bacon:

To be honest, I am unclear about what legal force the Central Bank could apply in determining what the criteria for banks for mortgage lending should have been. I am aware, as is the Senator, of what it is saying at the moment but at that time two and a half to three plus one was not being adhered to in all cases and as competitive pressure on the banks intensified the tendency to move outside those criteria increased. It was a one-way bet. There was no exchange rate risk and, in effect, quantitative easing was taking place in an Irish economy that was expanding rapidly, meaning we got a bubble.