‘No unilateral action’ to burn bondholders

THE Government has reiterated there will be no unilateral action to burn bondholders in bailed-out banks following reports that attitudes in Cabinet are hardening on the issue.

As Finance Minister Michael Noonan prepares to begin negotiations in the autumn on forcing certain bondholders at Anglo Irish Bank and Irish Nationwide to take a haircut on loans, some ministers believe he should take an aggressive stance with the European Central Bank, which has opposed the idea.

Some ministers are becoming more opposed to paying back in full the remaining €2.8 billion of unguaranteed and unsecured debt remaining in Anglo, and the €600 million in Irish Nationwide.