The Water is Wide.(Irish-American relations in the wake of bank fraud)

O'Clery is the North America editor of The Irish Times.

Most of the time I don't really think of the United States as a foreign country. In Ireland we regard America as the next parish after Galway. We all have cousins here. We speak English. Our poets and movie stars, like Seamus Heaney and Liam Neeson, have been absorbed effortlessly into the American cultural landscape. We think we blend in pretty easily.

So when Ireland's biggest financial institution, Allied Irish Banks, decided to buy a venerable old bank in Baltimore, Maryland, back in the 1980s, it was hardly considered a foreign venture at all. There were no language difficulties (though the Irish bankers had to learn that "Murlin" meant Maryland). The Irish felt at home when they arrived in Baltimore, where there is a big St. Patrick's Day Parade every year and one in six residents is Irish-American.

The acquisition of First National Bank of Maryland was a huge success at first, hailed as a model acquisition for other European banks to follow. Big profits flowed across the Atlantic. The American executives at First Maryland had an ideal owner: thousands of miles away, and prepared to let it keep its name and management. Irish people, too, loved the idea of a successful Irish-owned bank in America. It was a source of national pride. I boasted about it to American friends as a great example of the advance of the Celtic Tiger.

It was an example, to be sure, but of a different sort. Last February, a rogue trader named John Rusnak was discovered to have gambled away nearly $700 million of the Baltimore bank's money. It was the fourth biggest banking fraud in U.S. history, and Rusnak was just sentenced to 90 months in prison. When I began visiting Baltimore to research a book on the scandal, I found that the "model" transatlantic partnership was in fact deeply flawed. The bank's glowing annual reports--one showed yachts in full sail in Chesapeake Bay and boasted that "favorable Irish winds have strengthened First Maryland's position"--masked a hidden clash of cultures that had left the bank dysfunctional and wide open to fraud. Indeed, the same elements of religious, social and ethnic discord that have plagued Irish culture for centuries are, in the end, what bedeviled the banking union in Baltimore.

First National Bank of Maryland could be loosely described as the "Episcopalian bank" in Baltimore. It was run by the old-money set-- careful, mostly ...