RBS owns the Ulster Bank in Ireland and Lloyds offshoot HBOS went on a mad expansion spree in Ireland at the peak of the credit boom in 2005.
Now we can see why Cameron is so keen on an EU bailout of Ireland- with £143 bullion invested in Ireland, much of it directly into Ireland’s collapsing property market, it would be to a large extent a bailout of Britain’s banks. This is in any case inevitable given the collapse of our own economy and property market, but it would be a coup for the City if they could get the EU to cough up for a large chunk of it. The EU has yet to deal with the “British question”- the fact that they have left their western flank exposed to city of London financial operations. This could be an opportunity to do so. Interesting that after the rebuff of the Obama/Cameron offensive in Seoul, the focus turns immediately to the euro rather than to the infinitely more vulnerable pound and dollar.
Alex Brummer
16th November, 2010
No one in Britain can look at the rapidly unfolding Irish financial crisis with any kind of calm because the UK and Irish banking systems – and the countries’ wider economies – are inextricably bound together.
In These New Times 