Joe Higgins (Dublin West, Socialist Party)
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Let's talk a little bit about regulatory capture, perhaps, because you say on page 11 of your written statement to us, as Minister for Finance, in paragraph 77, "There was a lack of analysis by both Central Bank and Financial Regulator in challenging the over concentration of risk in property." You say, "There was clearly a culture of deference in operation between the Financial Regulator and the financial institutions." And in point 76 you say, "I believe that had there been more robust, independent work and scenario planning undertaken by both the Central Bank and the Financial Regulator regarding the banking system, this would have informed the silently evolving risk scenario and enabled the Central, the [Financial] Regulator and the Department of Finance to develop timely, strategic interventionist policies and strategies." Now, that's what you say on the one hand, Mr. Cowen.

Then I want to put to you what you did, and what you said yourself. For example, in a speech to the Institute of Bankers in Ireland annual dinner, 2 November 2006, and this is off the Department of Finance website, you said the following to them:

But, in my view it is the innovation coming from within the sector which is the most remarkable driver of change. Increasingly sophisticated derivative products seem to be arriving daily as a sector seeks to become ever more professional in the way it manages and hedges its risks and chases after that elusive higher yield.

Mr. Cowen-----