Irish Financial Crisis and the Irish Bank Guarantee
Michael provides an account of the liquidity crisis which was triggered by the Global Financial Crisis, and provides his thoughts on the Bank guarantee - a guarantee by Ireland of the debt liabilities of the banks in September 2008.
Overview
When the financial crisis reached Ireland’s banks, their liquidity rapidly dried up, leaving them at an immediate risk of failure. The government was forced to step in and guarantee the banks’ debts. That put a great strain on Ireland’s finances in turn, with Greece’s financial problems making matters worse. As a result, Ireland suffered from a long-term problem of bad loans.
Key learning objectives:
Explain why Ireland’s banks suffered a liquidity crisis
Describe how the Irish government was itself caught up in the crisis
Explain the consequences of the Irish bank guarantee
Summary
Expert
Michael Torpey
Michael began his career working with the Irish Finance Ministry. In 1992 he joined Irish Permanent Building Society as its first Treasurer and in 2000 became Finance Director at First Active. In 2010 he set up a specialist banking unit to lead the Irish State’s handling of the banking crisis. In 2013 Michael became Chief Executive of the Bank of Ireland until he retired in 2018.
