The full Honohan

Brian Cowen –

The continuing attempt to suggest that the Government’s approach to the affairs of Anglo Irish Bank was influenced by political or any inappropriate considerations is utterly without foundation. The facts in this instance demonstrate that as do the findings of the independent review carried out by Professor Honohan which similarly found that “there is no evidence or hint of corrupt regulatory forbearance.”

Governor Honohan’s report (para 1.33) –

Furthermore, although the climate of regulatory deference might have been unconsciously reinforced by social interaction – modest though it might have been – organised by regulated institutions, there is no evidence or hint of corrupt regulatory forbearance.

The Honohan report identified a risk of social interaction leading to forebearance, and based its conclusion that this interaction was modest on the reporting requirements of Financial Regulator staff in terms of gifts received from banks.  Brian Cowen — not being Financial Regulator staff — did not report his golf outing and presumably will claim anyway that it wasn’t a gift or hospitality received. 

Unfortunately, it looks like the government’s strategy is to refute an accusation that only could be proved by a note from Brian to Seanie “all right there Seanie, I’ve fixed your problem with the regulator, tanx for the cheque” while the actual problem — an excessively close circle of bankers, developers, and politicians — is sidestepped.   The Honohan sentence only deals with a narrow version of the former, while obliquely highlighting the latter.

And just a reminder of one issue that has not gone away, St Patrick’s Day 2011 will be the 3rd anniversary of the costliest St Patrick’s junket ever.