Sean Barrett (Independent) | Oireachtas source

Amendment No. 25 in my name was listed in the midst of Senator Thomas Byrne's amendments and I thank the Minister for his reply. The purpose of my amendment is to delete the line: "any of the Supervisory Directives, within the meaning of the Central Bank Act 1942". I refer to the supervision that failed and which has been a disaster for everybody in the House and the country. A journalist calculated that an official in charge had forgotten, could not remember or had no recollection of evidence 89 times. All we have to do is look at the material we have found since produced in the Regling-Watson, Nyberg, Wilson and Honohan reports, by the Comptroller and Auditor General and the Committee of Public Accounts. There was a building society - I kind of knew as it was located not far from me - and everybody knew it was on the rocks. The people in charge - this the phrase that has been used to describe them, as the Minister knows, were asleep at the wheel.

The idea of stricter regulation of the appointment of directors to banks seems to have disappeared into the sand, a phrase used by Mr. Sean Cromien, a former Secretary of the Department of Finance. Why did people move from the Department of Finance to the Central Bank more or less on an assembly line? Why did nobody know that when one moved from a banking system based on deposits to wholesale borrowing things changed? Why did nobody in the banks know that one had to have strict rules on loan to value and loan to income ratios when lending?

Like Senator Aideen Hayden, I commend the work Deputy Ciarán Lynch is doing with the committee. Banking is the last sector which should receive an exemption because it crashed the country. In the Central Bank which had 1,400 employees apparently two of them were supposed to regulate banks. Finding all of this information, as a society, was like extracting teeth. I would hate to think the slap dash way the Central Bank regulated was acceptable to anybody in Parliament. We have all paid the price - all of our constituents have it, which is why I tabled my amendment. We must get the message across to those involved in banking and those in the banking section of the Department of Finance and the Central Bank that we want records to be kept and that what went on in the country was unacceptable and that it had such disastrous consequences.

As the Minister will know, one of the matters on which Deputy Ciarán Lynch and the committee will place emphasis - not just the night when the bills finally came - is the hopeless analysis of banking by the bank regulator and hopeless conduct of banks. Do we know, for instance, if the incentive structure in Irish banking was changed in order that people would not bother to check incomes and if banks paid bonuses for shovelling money out? A large amount of damage was done by this sector, which is why I was reticent that it should receive an exemption. Of all the information sought we need to know how they engaged on supervisory directives.

It has been mentioned that the Europeans told us to do this. The Europeans were not of much use to us when this country had to take the burden of defending the euro. I hope there will be wider discussions between the Minister for Finance and Mr. Draghi. Ireland was let down by design faults in the euro system. Did anybody know this in the Central Bank? We badly need its records and I would appreciate any help the Minister can give us in that regard.

My concern is that I am not so sure the banks and the property sector would not do the same all over again. I am not so sure the new Central Bank Governor Honohan is trying to build is powerful enough yet to take on the continuity Central Bank which was rubbish and deserved the disapprobation of everybody for the way it superised bank regulations. These are my concerns that led to my tabling of amendment No. 25.