Measuring the Liabilities of the Irish Banking Sector
This post was written by Philip Lane
It is certainly quite difficult to measure properly the liabilities of the Irish banking sector, if this term is defined to mean those banks that are embedded in the Irish economy with significant domestic non-bank business. The main problem is that the aggregate banking data (as published by the BIS and the Irish central bank) are dominated by the activities of international bank groups that run significant volumes through the IFSC. These operations are pure offshore financial intermediaries and should be ignored in terms of assessing the scale of liabilities of the domestic banking system.
Rossa White has a written a useful short note “Irish banking liabilities - True figure is just over 300% of GDP, one-third of bogus ratio being quoted,” which is available via the Davy website.