Abstract
We present a review of the Irish banking collapse, detailing its origins in a confluence of events. We suggest that the very concentrated nature of the Irish banking sector, which will emerge from the policy decisions taken as a consequence of the collapse, runs a risk of a second crisis. We survey the literature on size and efficiency and suggest some alternative policy approaches.
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Notes
Commentary on the Irish banking sector requires cautious use of official statistics. The large statistical impact of the International Financial Services Centre (IFSC) has the potential to distort the effective footprint of the financial services sector. The IFSC acts as a special taxation and regulation zone for multinational financial services firms as well as multinational corporations wishing to engage in tax avoidance activities. In this context, the domestic group is the set of banks, regardless of ownership, whose primary focus is on servicing Irish non-bank residents.
It is published quarterly by the ECB, and the Irish data are available at http://www.centralbank.ie/mpolbo/mpolicy/Pages/lendingsurvey.aspx.
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Lucey, B., Larkin, C. & Gurdgiev, C. Learning from the Irish Experience – A Clinical Case Study in Banking Failure. Comp Econ Stud 56, 295–312 (2014). https://doi.org/10.1057/ces.2014.17
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DOI: https://doi.org/10.1057/ces.2014.17