When the crash came, the decision to guarantee the banks (flawed though it was in its design – blanket coverage and in the lack of prior consultation with partners) was underpinned by ECB liquidity support which prevented the chaotic currency depreciation which would surely have been the inevitable consequence had Ireland been outside the euro area.
Prior to the crisis, regulatory agencies, including the Federal Reserve, focused on the safety and soundness of individual firms – as required by their legislative mandate at the time – rather than the stability of the financial system as a whole.