Brian Cowen (Laois-Offaly, Fianna Fail)

In regard to what happened in Anglo Irish Bank, the problem was that the international credit crunch brought about a situation where its business model came under immediate pressure and the market made a decision on that. Its perceived exposure on the construction side was regarded as another negative but the idea that it was just in regard to the CFD issue is stretching things considerably.

I said that the acquiring of a shareholding by Mr. Quinn through the CFD mechanism was causing concern and was referred to me by the Governor in his normal meetings with me as Minister for Finance, which are conducted on a regular basis, and was unwound through 15% of shares being converted to shares for Mr. Quinn and his family. The other 10% then arose in regard to this other arrangement which is now under investigation by the regulator.

That source of instability was dealt with in July but, unfortunately, what we are now finding out is that the nature of the transaction in regard to the shareholding made up of the investors which was referred to the regulator has now been referred to the Office of the Director of Corporate Enforcement. It has to be dealt with to see whether it was a commercial loan conducted in the ordinary course of business. There are indications that perhaps that may not be the case. That issue has to be resolved by the Office of the Director of Corporate Enforcement.

However, to make the leap the Deputy just made that the CFD issue has caused all this problem in the banking system is totally exaggerating the case.

See this speech in context