Ireland ‘will not seek haircuts for investors’

IRELAND will not be seeking to impose haircuts on investors, Taoiseach Enda Kenny made clear during his visit to Brussels, emphasising that any debt write-down for Greece would be for Greece exclusively, as fears grew that such a move would destabilise the euro.

However, there were further indications yesterday that preparations are being made to protect EU banks as far as possible against the outcome of an expected Greek orderly default, especially those banks holding Italian and Spanish bonds.

The ECB and the head of Germany’s Deutsche Bank both warned against insisting on banks taking a bigger than the reported 21% haircut agreed in July, with the ECB warning it could “put at risk the financial stability of the currency area as a whole”.