He was involved at the highest level but had no direct or indirect commercial interests in the proceedings. He was there as a very senior and trusted employee of the State to make suggestions and follow political instructions. He did all of those things during those extremely difficult hours and those proceedings form the basis of a 380-page submission he has made to the banking inquiry where he is due to give evidence this Thursday.
That submission, details of which were published by The Sunday Business Post, strongly challenges the version of events already given to the inquiry by senior bankers Eugene Sheehy, the former AIB chief executive, and Brian Goggin, the former CEO of Bank of Ireland.
Mr Cardiff will, it is expected, challenge the bankers’ recollection of the extent of the bank guarantee sought and point out that the banks had prepared detailed wording for a guarantee before pivotal meetings opened. He will also give evidence that he was later instructed by then Taoiseach Brian Cowen to rewrite the terms of the guarantee to curb the banks’ broad-stroke ambitions.
Mr Cardiff is also expected to describe the indirect testimony given by former European Central Bank president Jean-Claude Trichet as a “fallacy”.
He will give evidence that Mr Trichet precluded any consideration of plans to impose losses on senior bank bondholders. Mr Trichet said this was merely advice but Mr Cardiff’s submission puts an entirely different complexion on the intervention, one that seems entirely plausible and gives an entirely different meaning to the phrase “the kindness of strangers”. It also undermines belief in the idea of EU-wide solidarity in the face of a looming banking crisis.
Though only a small proportion of Mr Cardiff’s submission has been published, it gives the impression that the bankers’ and the bondholders’ interests were the paramount concern of the commercial banks and of the ECB — which was firmly influenced by then US Secretary of the Treasury Timothy Geithner who strongly opposed the idea that bondholders might suffer any losses.
These events occurred almost eight years ago and it will be more than interesting to see which version of guarantee night will be offered by Mr Cowen when he gives evidence. Apart from the great costs imposed on this society, costs that will stretch across decades, these events are now historic. However, they are very real for the people of Greece.
Yesterday, EU Commissioner Guenther Oettinger warned there will be a “state of emergency” in Greece from July 1 without an agreement before the Thursday deadline. They are not dealing with the same individuals our Government faced on guarantee night but they are more or less the same players. It is very hard not to have huge sympathy for them.