Eamon Ryan (Dublin South, Green Party)

This is the worst market failure in the history of the State. It is not the first in the banking area. We had ICI, the DIRT scandal and the Rusnak scandal, and perhaps there was a moral hazard in the failure of the banks to learn that such scandals would not be tolerated or accepted and led them and us into this crisis. We now have to face up to the problem, take control of it and deal with it. We do not serve the Irish people if we try to ignore it. If one examines the international experience, in terms of how one handles property crises and bubbles which lead to banking crashes - there have been many - it is clear there is a standard procedure which is followed in most cases.

One puts in place a guarantee to try to stabilise the banks, one has to have some vehicle to manage the assets which are the problem and one has to solve the capital problem of the banks. It is a fairly standard set of procedures which we saw in the United States recently and in any other similar banking scandal. It is what we have been doing. It is not popular or easy, but it has to be done for the sake of the future of this country.

Deputy Kenny used the word "cancer" and he is correct. Anglo Irish Bank has done that level of damage to this country. Shame on the people involved. The sense of regret and anger is palpable and correct, in particular because Anglo Irish Bank is such a small bank and the crisis happened in a short period of time and grew quickly in recent times when the real damage was done.

Deputy Bruton asked about the term "systemic importance". The first time I heard the term used was when the Treasury Secretary in the United States of America, Mr. Henry Paulson used it October last year in reference to, I understand, Wachovia bank. There was a possibility it would go bust and a realisation by the United States authorities that they could not allow that to happen. Obviously they had learned a lesson from Lehman Brothers, which accounted for some 4% of American GDP. Anglo Irish Bank comprised approximately 50% of Irish GDP. They had learned the lesson that a bank the size of Lehman Brothers was of systemic importance for the overall economy. The size of Anglo Irish Bank is unfortunate and deeply regretted. It should never have been allowed to grow that big and was a false, fraudulent banking model.

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