Ireland Keeps Faith in Bank-Debt Deal Post author By Philip Lane Post date October 10, 2012 Read Eamon Quinn’s WSJ interview with Michael Noonan here. Categories In Uncategorized 3 Comments on Ireland Keeps Faith in Bank-Debt Deal ← ESRI Geary Lecture…and Seminar by Tim Besley → The Eurozone’s Narrowing Window 3 replies on “Ireland Keeps Faith in Bank-Debt Deal” ”Ireland came close to national bankruptcy after pumping in about €64 billion ($83.1 billion) to six lenders to keep them from collapse when the country’s property market crashed almost five years ago. Accounting for about 40% of annual national output, the costs of rescuing the banks are among the highest any government had to bear during the global financial crisis. The government pledged €32 billion in promissory notes to Anglo Irish Bank Corp. and Irish Nationwide Building Society that enabled the now-defunct banks to repay their debts, thereby preventing Ireland’s banking collapse from taking down other lenders in the euro zone. …But paying the principal and interest on that debt will cost the government more than €3 billion each year for many years. …Largely as a result of the cost of the bank bailout, Ireland lost access to the international bond markets in late 2010, and had to turn to the EU and IMF for a €67.5 billion bailout”. Remarkably, I believe that this is the first timt that this narrative has been outlined so truthfully & succinctly in a mainstream outlet outside Ireland. Even the Commission mouthpiece that visited last week had to admit that the decisions were made to protect the european banking system; something that remains unutterable for any Irish politician when holding office. ‘ But with little visible progress toward a deal since the summit, doubts have begun to grow. [Noonan:]”I am not predicting timelines,” he said. “I haven’t seen any slippage. There is a normal exchange going on (with the EU and IMF).” ‘ From D O’Donnell in anearlier thread: ‘Draghi said any possible rescheduling of the €31bn put into banks by the Government must wait until the banking supervisor is in place. He indicated this might not happen until the end of 2013.’ This has officially gone beyond the p*sstake stage. The Phantom at the Opera! http://www.businessweek.com/news/2012-10-09/schaeuble-calls-debate-on-legacy-assets-a-phantom Comments are closed.