I have to start this week by coming right out and thanking Anglo for being there in the early days of the Celtic Tiger, when no other bank would support business in Ireland. As we now line the bank and its previous management up for the firing squad, let's remember its full life and not just the last few years. Let's take the good and bad in equal measure.
Populist politics determines that Anglo is now to blame for everything, but let's get real here. If the problem was as simple as that, we would not be where we are in this zombie economy.
I borrowed a lot of money from Anglo over the years for IDA- and government-supported office projects. Without these buildings, many multinational jobs would not be here in Ireland. Every one of these projects was a risk at the time, and without a progressive business bank such as Anglo, many thousands of jobs would never have made it to Ireland from companies such as Compaq, HP, UPS, Microsoft and many more.
To build an economy you need infrastructure, and this includes speculative office buildings, factories and hotels. When the US multinationals came looking at Ireland in the mid-1990s, they liked what they saw in the people and the tax system, but they also needed offices. They were not willing to wait around for one to be built so it had to be available at short notice – on spec, as we would say in the business. We were generally competing with Scotland or Wales for these jobs and speed was very important to the success of winning these investments. Anglo was vital in building this infrastructure that Ireland needed to grow, supporting employment and the economy.
There was no point in approaching the establishment banks for this kind of lending. They were not trying to grow the economy and support business. Anglo was a powerful and dynamic force and it was vital to the early years of the Celtic Tiger when business was done sustainably.
I will miss Anglo for this and it will be missed in the future by the whole economy. We can see from the establishment banks that small businesses, farmers and people looking to make a start in life will get short shrift in the reception area of an AIB or Bank of Ireland branch. There will be lots of exciting poster and TV campaigns about lending and starting your own business, but they do not have the culture of business lending. Their new business model will be to increase loan margins on all existing customers so they have no need to lend new money to business. Can finance minister Brian Lenihan make them lend it? I doubt it. I have a creditworthy business ready with an application so I will report back on this just as soon as the application is refused.
That was the good, and when they were good they were great, and now for the bad and the collapse. I was a property developer and the property market has completely crashed. It is because of this crash that the banks have failed. The property market has crashed because it was driven too high by all the participants in the market.
It's a national phenomenon caused by the actions of hundreds of thousands of people, each in their own way causing a boom, and now a bust.
I am a borrower of money from Anglo and I will be a Nama client, or as they like to call me, a debtor. I won't be in there trying to blame Ahern or Cowen or Lenihan or David Drumm or Seán FitzPatrick. I will stand up and blame myself. I chose to go into the casino and I played at the table signing the personal guarantees. There are thousands like me and there are many more thousands who made a decent living working in and around the property business.
Benchmarking and other public service pay bonanzas were paid for by the property boom, so let's not pretend that the money was not spread around to the whole economy. Social welfare payments were raised on the back of Anglo lending. The Irish Times and other newspapers never had a problem accepting adverts selling overpriced apartments, and to this day, they still accept money to advertise insolvent banks such as Anglo. Profiteering from the death of the property market is great business for accountants and lawyers, who gorge on fees in insolvencies and liquidations. Everybody had skin in the game so stop looking for scapegoats as a way to hide personal guilt.
So I say to Charlie Bird and the like: get off David's lawn and get out of Seán's front drive. They have lost everything but they still have to live. The bank failed because we all failed.
So back to the start, Anglo was good and bad because the people of Ireland are good and bad. Our national successes and failures are a reflection on ourselves. If you want to know what caused the crash and the failure of Anglo, have a look in the mirror. We all built the boom and we all caused the bust.