‘The bank is dead. Long live the bank.’
LAST week they came to bury Anglo. And they came to rescue AIB. Brian Lenihan’s insistence that if he had allowed Anglo to go to the wall it would have torpedoed AIB, began to ring true.
The accepted view in government circles was that abandoning Anglo would have toppled Ireland’s banking dominos; that AIB was particularly vulnerable as it shared dodgy developer clients; that the liquidation of one could bankrupt the other; that they shared an addiction to property. What was not so apparent was that they shared a flawed culture. The big news last week was not Anglo at all.
The €28bn to €29bn needed to save Anglo had been well flagged. Even the worst-case figure — the €34.3bn — had been anticipated by Standard & Poor’s ratings agency.
No, the depressing bombshell was that AIB, the biggest bank in Ireland, needed yet more life support.
It is an indication of the depth of the spinning that has surrounded the whole banking story that Anglo was always the whipping boy for everyone’s ills. Anglo was the worst offender, but the disease w