Bloomberg the Company & Products

Bloomberg Anywhere Login


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Irish Banker, Felled by ‘Adult’ Surfing, Seeks Meltdown Answers

Don't Miss Out —
Follow us on:
The Bank of Ireland headquarters
The Bank of Ireland headquarters sits in Dublin, on Oct. 1, 2009. Photographer: Frantzesco Kangaris/Bloomberg

Sept. 30 (Bloomberg) -- If Mike Soden had his way, the title of his book on Ireland’s financial crisis would pivot on a self-mocking joke: “Big Bust.” He is, after all, the Bank of Ireland Plc chief executive officer who resigned after viewing “adult” websites on his office computer.

Six years and one meltdown later, Soden has learned to laugh at his embarrassing infringement of company policy.

“What I’m trying to do is trivialize something that hurt my career enormously,” says Soden, 63, wearing a grey polo shirt during an interview in his Dublin home, two doors down from Bank of Ireland’s new headquarters along the Grand Canal.

Soden, who was appointed yesterday to the country’s central bank commission, has spent much of his time of late monitoring the collapse of Ireland’s financial system. The result is a book just released under a more staid title chosen by his publisher, “Open Dissent.” It probes the causes of the meltdown and how the republic might extricate itself.

Sitting at a steel-and-glass table in his conservatory-style kitchen, Soden discussed taxpayer injections of capital into Anglo Irish Bank Corp.; Ireland’s possible exit from the European Union; and the government’s National Asset Management Agency, the so-called bad bank set up to purge lenders’ souring real-estate loans.

Brennan: Would Bank of Ireland be in a better place today had you not stepped down?

Question of Reputation

Soden: I don’t know. I wasn’t there to make the decisions. I’m not prepared to take potential blame, nor credit.

I walked out to protect the reputation of the bank. Most people said, “Oh, you looked at something.” I said, “Sure I did.” I acknowledged that.

Fast forward. The same people who accepted my resignation oversaw the destruction of reputation not only of the bank, but of the country, and they stayed on.

Brennan: What went wrong?

Soden: I can’t believe it took 221 years to build up a balance sheet of 100 billion euros and only four years to make it 200 billion euros.

In every bank I’ve ever been in, there’s been a battle between the people who want to do business and the guys who are meant to protect the balance sheet. The sales people won in the end. That’s why Anglo Irish Bank collapsed and why Bank of Ireland has had all its problems. Allied Irish Banks are in the same situation.

Wrong Mindset?

Brennan: Is the National Asset Management Agency working?

Soden: NAMA was formed for three reasons: to re-establish the banks; to put liquidity into the business sector; and, through that, to help the economy to recover. A year later, which one of those has even started? NAMA has the huge burden of saving the country economically. Unfortunately, they have the mindset of an investor, not a trader.

Brennan: What do you mean?

Soden: When there’s no market and NAMA can pay whatever price they like for assets, the investor mindset sets in and says, “The lower we pay -- even if it requires additional capitalization of the banks from the government -- the better we will look in years to come.” That’s not a satisfactory process. You create liquidity in the market by buying and selling.

Brennan: Is Ireland’s borrowing sustainable?

Soden: We can’t borrow our way out of problems. But we can earn our way out, so we don’t burden the next generation.

Brennan: How should Ireland cut the deficit?

Soden: The entitlement mindset that pervades our society has to be readdressed. I’m sorry, you may be entitled to be treated with dignity and respect, but you are not entitled to money that we don’t have, because it will stop at some point.

Voters and Bailouts

Brennan: Isn’t it hard for voters to stomach more cuts, given the salaries at banks that have been bailed out?

Soden: Anyone who was on the executive committee of the banks should have been removed -- bar none. People say it’s easy to say so in hindsight. But people in senior positions who get paid a lot of money are paid for foresight. They must know they can only be judged with hindsight.

Brennan: What do you make of the debate that Ireland should default on Anglo Irish bonds to cut the cost of the bailout?

Soden: If you default, you will have to wait 15 to 20 years before you can touch the capital markets again. I don’t believe for one instant that anyone in the country, starting with the prime minister and finance minister, would want us to default.

Bye-Bye, EU

Brennan: Your book mentions the possibility of Ireland leaving the EU. Are you serious?

Soden: It’s an extreme solution, but we’ve got to look at our alternatives. Are we simply in the hands of Europe?

Ireland’s emigrants chose America before they ever did Europe. Hawaii was the 50th state, Alaska was the 49th. If we were given the opportunity, could we become the 51st state?

“Open Dissent: An Uncompromising View of the Financial Crisis” is published by Blackhall (193 pages, 16.99 euros)

(Joe Brennan writes for Bloomberg News. The opinions expressed are his own. This interview was adapted from a longer conversation.)

To contact the reporter on the story: Joe Brennan in Dublin at

To contact the editor responsible for this story: James Pressley in Brussels at

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.