The Taoiseach has conceded that domestic vulnerabilities in the economy here led to the near collapse of the banking system.

In a wide ranging speech this evening Mr Brian Cowen said the crisis caused untold damage, and that those who engaged in fraud will be pursued by the gardaí with determination.

Speaking to the North Dublin Chamber of Commerce, Mr Cowen mounted a detailed defence of his actions as Finance Minister.

The Taoiseach said that in the Budget for 2006 he restricted a range of property reliefs and later resisted calls for the abolition of stamp duty.

He told his audience that while many would expect him to ascribe the banking crash to international factors alone that was not his view.

There had been domestic vulnerabilities, but at the time, authorities from the IMF down had concluded that the Irish economy was robust enough to withstand the shocks.

The Taoiseach then listed the mistakes which he believed had been made; including a failure to end property tax breaks sooner, and what he called a stunning failure in corporate governance in some institutions.