The Government welcomed the two reports on the banking crisis, saying they had drawn attention to a number of significant issues that needed further investigation.
These included bank practices, risk management and failures in the financial institutions, the performance of the Central Bank and Financial Regulator; and the role of budgetary and economic policy.
But the opposition insisted that Mr Cowen had to shoulder the lion's share of the blame for the crisis. Fine Gael accused him of fuelling the property bubble. Labour claimed he had a 'party on' approach to the economy.
The Government is to refer the reports to the Joint Oireachtas Committee on Finance and the Public Service for its views on issues that should be covered by the terms of reference of the Commission of Investigation.
Taoiseach Brian Cowen said the reports vindicated the approach taken by the Government to deal with the crisis and confirmed the need for a bank guarantee scheme. He referred to Governor Honohan's finding that the collapse of Anglo Irish Bank would have cost far more than the guarantee.
The Taoiseach said the reports also showed that the advice given by bodies such as the Central Bank and IMF before the crisis was that the banks had enough capital and that a soft landing in the property market was expected. He said he agreed that a more restrictive budgetary policy would have helped.
Asked about his period as Finance Minister, Mr Cowen defended his spending policies, saying they were based on advice and predictions received by the Government at the time.
He said there would have been a more restrictive fiscal policy 'if we knew then what we knew now'.
Mr Cowen said that, at the time, some opposition parties were saying that not enough was being spent in some areas.
Commission of Investigation's six-month time limit
Finance Minister Brian Lenihan emphasised that today's reports are preliminary, scoping reports, which will point the way to a more detailed examination by a Commission of Investigation.
He said the commission would have a six-month time limit to bring its work to the Government.
After draft terms of reference are agreed, the Minister said he will prepare a draft Government Order to establish a statutory Commission of Investigation.
The Minister for Finance said he would make himself available to the Joint Oireachtas Committee on Finance and the Public Service to answer any questions it might have, particularly on the period 'up to and including' the decision to introduce the bank guarantee scheme at the end of September 2008.
Minister Lenihan also said he would also make documents prepared in that period available to the Committee.
Communications Minister Eamon Ryan said the reports showed a 'systemic failure' in the political and regulatory systems.
He said he hoped Professor Honohan's analysis of the events leading up to the bank guarantee scheme put the Government's decisions at that time in context.
He said he wanted a 'quick, open and thorough' inquiry into the banking crisis.
Catastrophic policy errors - Fine Gael
Commenting on today's reports, Fine Gael's finance spokesman Richard Bruton says the independent expert witnesses have found that Brian Cowen and the banking and regulatory systems he oversaw were guilty of 'spectacular and catastrophic failures of economic management'. He says ordinary taxpayers were left to pay the price of this failure.
He says the reports show that Ireland was not pursuing sustainable economic policies that were blown off course by an international financial tsunami. 'Far from it: Ireland's economic leaders were guilty of catastrophic policy errors', he states.
He also describes it as extraordinary the fact that the draft terms of reference for the reports excluded both the Government's own contribution to the crisis and its response since September 2008 as well as the decision to grant the blanket guarantee for Irish banks.
He suggest this is a political cover-up and says taxpayers are entitled to open accountability for those responsible for the crisis and real change to ensure that nothing like this can every happen again.
Labour notes 'excoriating criticism' in bank reports
Labour's Joan Burton said this evening that never before in the history of the state have the policies of a Government been subject of such 'excoriating criticism' as today's reports on the banking crisis.
She pointed out that both reports stress the 'home-made' element of the banking crisis and they both dismiss the 'Lehman defence' that international factors were mainly to blame for the country's problems.
The Minister says that both reports offer a scathing analysis of the failures in banking regulation at critical times and the tolerance shown to banking practices were blatantly irresponsible.
She says the buck has to stop with Ministers, including the Taoiseach, because they had general responsibility to protect the public interest in the operation of regulatory agencies.
The purpose of the dual reports published today was to establish the framework for a full enquiry into Ireland's banking collapse. Deputy Bruton says for that enquiry to have any credibility it must have personnel and terms of reference than can command all party support in the Dail and have full public confidence.
IBOA will work closely with new Commission
The IBOA - which represents over 22,000 staff working in the financial services sector - has welcomed the broad thrust of the two preliminary reports into the banking crisis.
'Taking the two documents together, they clearly identify the key factors that contributed to the near collapse of the banking system in this country,' the IBOA General Secretary's Larry Broderick said.
He said a poorly applied regulatory regime, a Government tax framework which inflated the property bubble and a self-indulgent banking leadership combined to make a vicious circle which spiralled out of control and wrought havoc on the economy of this country
He said those who indulged in this irresponsible behaviour have emerged relatively unscathed - availing of generous golden parachutes and substantial nest eggs to comfort them in retirement.
'Meanwhile the rank-and-file staff in the financial services sector - who on a number of occasions in the last decade warned of the dangers of the prevailing culture in the industry - are counting the cost of their senior managements' calamitous lack of judgement as significant job reductions are prescribed as part of the price of rescuing these institutions,' Mr Broderick said.
Mr Broderick said the union intends to contribute actively to the work of the Commission by highlighting the unique perspective of its members who have a long-term commitment to building a financial services sector which would be primarily driven by consistent service rather than quick profit.
