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		</div><p><a href="http://londonglossy.com/wp-content/uploads/2010/11/irish-debt-crisis-failings-denied.jpg"><img class="alignnone size-full" title="FSA boss Lord Turner has denied 'failings' over the Irish debt crisis" src="http://londonglossy.com/wp-content/uploads/2010/11/min-irish-debt-crisis-failings-denied.jpg" alt="FSA boss Lord Turner has denied 'failings' over the Irish debt crisis"/></a></p>
<p>City regulators have not taken their eye off the ball in reining in UK bank exposure to Ireland&#8217;s debt crisis, the head of the Financial Services Authority has said.</p>
<p>Lord Turner, chairman of the FSA, told MPs the financial exposure of the UK banking sector was &#8220;not out of line with what you&#8217;d expect&#8221; despite market fears that have hammered bank shares in recent days.</p>
<p>The FSA boss, appearing before a Treasury Select Committee hearing, was criticised for &#8220;regulatory failings&#8221; in letting banks have so much cash linked to Ireland.</p>
<p>The UK economy&#8217;s vulnerability to Ireland has prompted the Government to agree an estimated £7 billion in bailout cash to help save it from going bust.</p>
<p>Banks suffered further share volatility on Tuesday as fears failed to subside over the impact on the sector of Ireland&#8217;s woes, with reports suggesting the most heavily exposed &#8211; Royal Bank of Scotland and Lloyds Banking Group &#8211; have £54 billion and £27 billion at stake respectively.</p>
<p>But Lord Turner told MPs the FSA had not made failings over Ireland, confirming its bank stress tests took into account exposure to the country.</p>
<p>He explained that part-nationalised banks RBS and Lloyds had built up their exposure to Ireland not through a &#8220;sudden splurge&#8221; of loans to Irish banks or through buying sovereign bonds, but due to their presence in the country.</p>
<p>RBS owns Ulster Bank, which is based throughout Northern Ireland and the Republic, while Lloyds-owned HBOS has also had a significant business in Ireland for some years.</p>
<p>Lord Turner said the fundamental bank exposure was to the Irish economy, not the Irish state or banks, and added that banks had not been left overly exposed.</p>
<p>However, his comments are at odds with those of Bank of England Governor Mervyn King, who admitted last week the issue was &#8220;by no means trivial&#8221; to UK banks.</p>
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