Ex-Central Bank chief contradicts ECB president at banking inquiry

Ex-Central Bank chief contradicts ECB president at banking inquiry

The former governor of the Central Bank says the ECB warned Ireland not to allow Anglo Irish Bank to collapse like Lehman Brothers.

John Hurley says Frankfurt was consulted in the days before the guarantee, and warned that Anglo could not be allowed to collapse.

That appears to conflict with comments from the former ECB president Jean-Claude Trichet, who denies calling Brian Lenihan and ordering him to save the bank.

Mr Hurley has told the Banking Inquiry that the instructions from the ECB were clear.

John Hurley

Mr Hurley said: "The liquidity outlook changed quickly on the morning of the 29th of September, when it became clear that without assistance, Anglo would not be able to open for business the following morning.

"Arising from contacts with the ECB, the view at the time was that Ireland was expected to stand behind its banks, and a Lehmans-type situation was to be avoided."

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