I think that is probably a reasonable view at the time. It was very brave to give the guarantee, but it was based on the banks are OK, Merrill Lynch and what have you. The two things in 2009 that then made that look like a poor decision, one was NAMA, because they fashioned that rod for their own back, they created losses in the bank they had just guaranteed.
Which I still cannot understand why anyone would do that. The second one would be the Irish economy did go into a real hockey stick dive, starting in the first quarter of 09 and then the loans started to deteriorate.
NOD: Did BOI and AIB mislead Lenihan and Cowen that night?
DD: No, I don’t think they mislead, I don’t think any of the banks believed there was anything like the bad debts that came afterwards. What they did know was that Anglo had run out of money, because we had been down to both of them, we had been down to BOI and we had talked to AIB but they were also running out of money and they wouldn’t last much longer. What pissed me off is they planted it entirely at the door of Anglo, Anglo owned a proportion of it, but they planted the whole thing at the door of Anglo and got themselves a guarantee. BOI told us they were having the same problems. ‘Were the big bank, but we’ll be OK, look at him, you better issue a guarantee, because he is going to bring us all down’. But they got the guarantee for their own benefit as well. They had actually very successfully pinned it all on Anglo, don’t mind some of it, but they pinned it all.
NOD: I just wanted to ask about Ireland at the moment, obviously it was home for a very long time and you mentioned your family. What has it been like watching Ireland deteriorate the way it has since you moved here in May 09?
DD: Terrible. You live in hope that it hits bottom or has hit bottom, what’s going on in the rest of Europe right now is very frightening as well. But you hope that the ingenuity, the things we have relied on in the past, the smartness, the education, youthfulness, energy and everything that is in Ireland lifts it out. Talking to family on the phone, one of my siblings was trying to get a job, applied for a van drivers job and was told don’t bother sending in the CV because there were 1,700 applications for it.
MM: When you hear stuff like that do you feel guilty in any way?
I have great regret that no one in any bank or any government agency or anybody at all saw it coming. It came out of America and it wreaked incredible damage.
Thank you David Drumm
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