Irish banking inquiry 'must be public'

The Irish government has pumped billions of euros into Irish banks

An official inquiry into the Irish banking crisis must be held in public, according to a member of the Greens, a partner in the coalition government.

The remarks were made by Senator Dan Boyle whose party leader John Gormley held talks with the Taoiseach Brian Cowen to discuss the issue.

The precise nature of the inquiry is expected to be set out on Tuesday.

At the height of the financial crisis, the Irish government used billions of public money to stabilise the banks.

Some analysts believe that billions more could be required in the coming months.

'Bad banks'

The Irish parliament is due to hold a two-hour debate on the inquiry on Tuesday afternoon.

The Irish Times newspaper reported that Mr Boyle believes his government would opt for a "hybrid" inquiry - with both a private and public phase - to satisfy the demands of the Greens that it be open and transparent.

The Republic's economy has been one of the most hard-hit by the global economic downturn.

Its once lauded "Celtic Tiger" economy was underpinned by a booming property market, but when house prices plummeted, Irish banks which had lent vast sums to property developers found themselves in trouble.

As well as propping up the banks with public capital, the Irish government nationalised the heavily exposed Anglo Irish Bank, which reported the biggest loss in Irish corporate history.

Last March, the Irish Republic lost its "AAA" sovereign debt rating, an international measurement of confidence in a country's public finances.

'9/11-style inquiry'

In November, the Irish parliament approved legislation to establish a "bad" bank to absorb problem loans in the troubled Irish banking sector.

It was agreed that the National Asset Management Agency (NAMA) would have 54bn euros ($80bn; £49bn) to buy toxic loans from banks.

The governor of the Irish Central Bank, Patrick Honohan, has called for a '9/11-style' inquiry into the causes of the Irish banking crisis, similar to the US government's inquiry into the terrorist attacks of 11th September 2001.