Role of ECB in financial crisis will form part of Oireachtas bank probe

The role of the European Central Bank (ECB) in Ireland’s financial crisis and any pressure it applied on the Irish Government will form part of the long-waited Oireachtas banking inquiry under terms agreed.

TDs and senators yesterday also agreed that media and newspaper bosses could be called before the probe to answer questions about whether they indirectly influenced the property bubble.

Inquiry chairman, Ciaran Lynch last night said he expected the probe to be up and running in November and for public hearings to begin in January at the latest. There were 55 amendments to the terms of the inquiry agreed by the cross-party group yesterday.

However, there was broad satisfaction among members about its terms.

The inquiry terms will now be sent before the Committee on Procedure and Privileges for approval.

Inquiry member and Fianna Fáil finance spokesman Michael McGrath said he was pleased members had accepted his proposal that role and influence of the ECB on the issue of burden sharing with bondolders would be examined.

“Ultimately, that was an important reason why the bill ended up being so high for taxpayers — the inability of the previous and the current Government to incur losses on senior holders.”

Whether or not former ECB president Jean-Claude Trichet appeared or not was not the main issue, he said.

“The important thing is that somebody comes and speaks on behalf of the European central bank,” he said.

It has been alleged that the ECB president threatened to withdraw emergency assistance to Ireland in 2010 if the Government refused to enter the bailout and also pay out unsecured bondholders.

Inquiry member Joe Higgins explained that senior editors, financial controllers and board members of media groups may also be compelled to appear.