Why you can’t see the ‘black book’ that was never used for the banking crisis
The Central Bank headquarters in Dublin (File photo)
NEITHER THE DEPARTMENT of Finance nor the Central Bank will release the so-called ‘Black Book’, a crisis management manual intended to assist officials during financial crises, which was never used during the bank crisis five years ago.
The ‘Black Book’ is referred to in the Nyberg report into the causes of the banking crisis which led to the fateful guarantee of Irish banks in September 2008. The report notes: “In the actual crisis no use was made of the Black Book procedures.”
The manual lays out procedures for emergency funding from a Central Bank or emergency liquidity assistance (ELA), guidance on legal issues related to insolvency processes and providing state aid to industry, and information on how to contact the responsible persons in a crisis.
It has been in existence since 2001 when it was prepared by the Central Bank of Ireland to provide for a set of processes and procedures to refer to during the management of financial crises.
But it was never used when Ireland’s banks were plunged into crisis at the back end of the last decade resulting in the eventual guarantee of all liabilities of Irish banks at an eventual cost of €64 billion, a move which later resulted in Ireland needing an international bailout.
The manual was referenced in a parliamentary question from independent TD Stephen Donnelly this week.
Donnelly asked the Minister for Finance Michael Noonan if he would release a copy of the ‘Black Book’ as it existed at the end of 2006 or as it was redrafted in the crucial period leading up to the banking crisis between August 2007 and September 2008.
Noonan said the manual was passed to the Department of Finance “on the understanding it would be treated in strictest confidence given the nature of the matters treated in the document”.
He described the ‘Black Book’ as a document which lays out a “set of processes and procedures to assist it in the management of a financial crisis situation”.
“I do not therefore propose to provide a copy of the document,” Noonan said.
Contacted this week, the Central Bank declined to answer a series of questions about the document including the content in it, how many times it has been updated and when it was last updated.
A spokesperson said that the document laid out “the principles under which the Central Bank would operate during a crisis; operational procedures and terms and conditions for ELA; legal issues relating to insolvency laws and state aid to industry; and information and logistic issues such as arrangements for contacting the responsible persons in a crisis.”
The spokesperson declined to comment any further.
Posted on May 15, 2013, in Banking, buisiness, Government, Human rights and Liberties, IMF/ECB, Ireland, National Politics, politics and tagged Black Book, Central Bank, Central Bank of Ireland, Department of Finance, Dublin, Ireland, Irish News, Michael Noonan, Stephen Donnelly. Bookmark the permalink. Leave a comment.