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The Word on the Week

Banking on Irelandx

The Banking Inquiry into the Irish banking failures, which arose in the years 2008-2010, reported this week after almost a couple of years of work and at a cost of €6.6 million. Their blockbuster, rushed out before the Dial was wound up for the next general election, ran to 600 pages.
The result has been underwhelming! This is largely due to the absence of names and consequently blame is spread fairly evenly across the land. The only exception was the taking to task of the President of the European Central Bank. He cost us €9bn but what’s that when we were in debt to the tune of €160bn when you add in our “normal” borrowings to run the country!
It is said that he prevented us from defaulting on the bank’s bondholders (the people who give the banks their money to lend) as they were ‘banking’ on Ireland to honour their bonds. And with a little persuasion from the President of the ECB our Government got us, the taxpayers, to pay the debt in full.
Of course the joy of unlimited money, full employment (provided you were good at laying concrete blocks) and little or no regulation, made us all a bit light-headed.
Our 6 banks were embroiled in proportion to the size of their CEO’s ego! The bigger the ego the bigger the mess! The rigour of normal banking in assessing loan worthiness was set aside in the competition for clients spurred on by the ready availability of money.
We were not alone in this race to the bottom but when the crash came only Greece were beneath us!
“The love of money is the root of all kinds of evils. It is through this craving that some have wandered away from the faith and pierced themselves with many pangs” (1 Timothy Chapter 6 verse 10). There is little doubt that money has many lovers! It becomes more attractive when it belongs to other people and you have the pleasure of spending it!
This soon becomes a game where the lenders (the banks) go after new borrowers (largely the builders/developers) offering loans of up to 100% of the project on little or no security.

During the boom years the government had never had it so good and discouraged the regulatory authorities from doing their job, not that it took much to discourage them. None of us like to be unpopular! It takes principled people to stand against the tide and there were few of them around.
It reminds me of the night Jesus was betrayed. The disciples had run off with the exception of Peter who probably had wished he had joined them! The good times were clearly over and the truth of “I will strike the shepherd and the sheep of the flock will be scattered” (St Matthew Chapter 26 verse 31) had become all too apparent. This was a prophesy Zechariah made about 550 years previously which Jesus applied to himself. No one stood by him all kept their distance.
The Eucharist had just been inaugurated in the upper room in Jerusalem when Jesus asked the disciples to eat and drink the symbols of his actual flesh and blood which were about to be made a sin offering for many (verses 27/8). With perhaps the taste of the bread and the flavour of the wine still on their lips the disciples were immediately in need of the forgiveness which was to be actualised on the cross.
Criminally negligent bankers and us ordinary sinners can give the last word to Zechariah “On that day there shall be a fountain opened for the house of David…to cleanse them from sin and uncleanness” (chapter 13 verse 1) and by God’s grace it is still open today.