Senator Darragh O’Brien has said that “it is now abundantly clear that Fine Gael and Labour deliberately used reckless and unrealistic rhetoric on banking policy during the general election to deceive the public and maximise their support. Far from burning bond-holders Fine Gael and Labour have simply burned their false promises. It is clear from the new Government’s banking announcement yesterday that Fianna Fáil was the only party to tell the truth to the Irish people during the election.”
In its election banking policy document Fine Gael stated clearly:
“Should some credible, combination of these [renegotiation of EU/IMF deal; burden-sharing for senior bond holders; longer-term funding mechanism for banks] options prove not be available from Europe, the next Irish Government would – in order to restore its own credit worthiness – be left with little choice but to unilaterally restructure of the private debts of those Irish banks in greatest need of recapitalisation.”
Senator O’Brien commented “Now, with the votes counted government ministers use the exact same reasons to justify why burden sharing is not happening, pointing out as we did that ‘the reputational damage to Ireland alone would not be worth it’. Meanwhile the Labour Party has abandoned its banking policy in its entirety.
“These latest stress tests by the Central Bank are indeed very bad news, but I hope as I know everyone does that they show the very worst case scenario and we can start moving forward as a country. The Fianna Fáil-led government instructed the Central Bank to conduct a similar process a year ago and those figures turned out to be too optimistic.
“The banks have let everyone in Ireland down with their reckless lending decisions. The banks also spent the last few years misleading Government and frustrating efforts to sort out the problem once and for all. People will be angry at the cost of keeping a banking system in place but the truth is that our country and economy needs a stable banking system. This was always the case. It’s just a pity that Fine Gael and Labour misled the electorate during the campaign, creating a false hope that there was an easy way to achieve this.”