Eamon Ryan insists Trichet acted to protect bondholders

Green Party leader Eamon Ryan has insisted that the European Central Bank had a very strong role in telling Ireland not to burn the bondholders.

Eamon Ryan insists Trichet acted to protect bondholders

Mr Ryan said he disagreed with statements made by former ECB president Jean Claude Trichet in response to questions put to him by members of the banking inquiry last week.

Mr Trichet last week denied the ECB forced Ireland into a series of financial measures during the crisis. He also denied that he told former finance minister Brian Lenihan to save the banks at all costs.

RELATED: Lenihan name was ‘sullied’ by Trichet

Mr Ryan, a former energy minister, was in Cabinet during the Fianna Fáil-Green coalition when the financial crisis hit the country and the bank guarantee was agreed in September 2008, as well as when Ireland later signed up for its financial bailout in 2010.

“We were fairly centrally involved at the pinch point, in 2010,” said Mr Ryan. “I don’t doubt the motives of anyone involved, be it Jean Claude Trichet, my colleagues in government or officials we were dealing with... all the key people.

“We were working fairly closely together as a team and by and large everyone on the team was fighting for Ireland.

“I was a disappointed with what Mr Trichet said in a number of ways. A number of things he said are absolutely true, there was massive ELA [liquidity] support. Ultimately the approach [was], ‘please God, touch wood, [this] is working’.”

RELATED: Trichet regrets nothing about ECB ‘advice’ during crisis

Mr Trichet denied last week that the ECB had told Mr Lenihan or the current finance minister, Michael Noonan, that under no circumstances should Ireland burn the bondholders. Mr Ryan said he disagreed the ECB played no role here.

“My experience is that the ECB did have a very strong role in saying we shouldn’t be burning bondholders,” said Mr Ryan. “We had a full four-year plan written long before...my experience was that they did push us into a deal and it was done through the media, not by direct communications through the Government, and there needs to be lessons learnt in Europe around that.”

Mr Lenihan said in 2010 that he received a voicemail just days before the 2008 bank guarantee, in which Mr Trichet allegedly said save the banks “at all costs”. Mr Trichet last week denied saying this.

RELATED: Brian Lenihan's family insists Trichet did tell him to save banks

However, Mr Ryan said yesterday that that was the message overall coming from Europe and it had filtered down through Cabinet.

“That was the standard [message]…and this was a global response,” said Mr Ryan. “This came from the [US] treasury, it came from Europe... I wasn’t involved in talking directly to the ECB, the ECB don’t talk to governments directly. But the absolute clear message from the United States and from Europe, because we were so close to the edge, was don’t let the banks go.”

Brian Lenihan’s aunt, Mary O’Rourke, said Mr Trichet’s comments “sullied” the name of her nephew.


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