Banking excesses were essentially a global phenomenon in the first decade of the 2000s. Yes, Irish banks probably found it that bit easier to access foreign funds when no account needed to be taken of exchange rate risk. But Iceland’s banks also sourced international funds without much difficulty.
In the past, exchange rate regimes did not come complete with specific external supervision of domestic policies. To be sure, the International Monetary Fund (IMF) has conducted surveillance of its members’ fiscal policies for decades, regardless of their exchange rate regime. Ireland’s peg to sterling was of course not accompanied by banking supervision conducted by the Bank of England.