I am somewhat confused. During the run on Northern Rock I understood that the Bank of England disclosed information because they were obliged to by EU regulations. They could not keep it secret, as apparently had happened in the past. But Charlie McCreevy made some comments today that confused me:
Mr McCreevy said in a speech that Britain’s transparency rules were too strict…The announcement of the rescue, which spurred customers to line up outside branches and withdraw more than £2 billion pounds over three days, was the fault of the UK’s “gold-plating” of EU disclosure rules, Mr McCreevy said.
If it was the BoE’s fault, why does the EU need to review transparency rules? And if the BoE were partly to blame for the run on Northern Rock by “gold plating” disclosure rules, could it be the case that an Irish bank has had to turn to the Central Bank here for funds, but this information has not been disclosed in order to prevent a run?
Maybe A Random Walk can help.
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2 responses to “Finance question”
It’s up to each regulator as to how they implement EU regulation so obviously the UK took a certain full disclosure route. You’d need to look at the equivalent Irish legislation to see how we have implemented it here..
Hmm. I wonder what the Irish legislation is called. It seems at least a possibility that an Irish operation was bailed out. Worth looking into.