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Saturday 3 December 2016

We did not put gun to head of Irish Government insists former ECB boss Trichet

BANKING

Jean-Claude Trichet, former President of the European Central Bank pictured before his address to the Institute and International and European Affairs and members of the Oireachtas Banking Inquiry at the Royal Hospital Kilmainham
Jean-Claude Trichet, former President of the European Central Bank pictured before his address to the Institute and International and European Affairs and members of the Oireachtas Banking Inquiry at the Royal Hospital Kilmainham
Sinn Fein's Pearse Doherty of the Oireachtas Banking Inquiry Committee questions Jean-Claude Trichet, former President of the European Central Bank

Former European Central Bank President Jean Claude Trichet has rejected claims the institution "blackmailed" Ireland in November 2010 by forcing it into a Troika bailout.

Mr Trichet insisted that rather than forcing Ireland into a bailout, the ECB provided the Government with tremendous support, more than it gave to any other country across the Eurozone.

Mr Trichet also contradicted previous reports that he left the late Brian Lenihan a voicemail three days before the bank guarantee insisting the Government must save the banks at all costs.

During a three-hour-long event in Kilmainham, Dublin, Mr Trichet was quizzed by members of the banking inquiry over his contact with the Irish Government in the lead-up to the bailout.

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His decision not to attend the inquiry in Leinster House was queried by committee chairman Ciaran Lynch.

Mr Trichet completely rejected suggestions that a gun was put to the head of the Government to guarantee the banks.

"We helped Ireland more than any other institution. What we have done for Ireland was far more than any other country," he said.

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Mr Trichet also denied that he stopped the Irish Government from burning bondholders during the financial crisis, and said the ECB simply "advised" the Government against burning bondholders.

"The ECB simply gave advice on this issue, it was a matter for the Government," he said.

"It was a consensus view at European level that burden sharing was too risky a proposition to countenance at that time," he added.

He said it was a balancing act for the Government to decide what was in the best interests for the country.

questioned

Just hours before the Trichet hearing, the inquiry questioned former group chief executive of Bank of Ireland, Brian Goggin, in Leinster House.

He said former Taoiseach Brian Cowen was "very much in charge" the night of the bank guarantee.

The late Brian Lenihan engaged in most of the interaction "discussions, looking for views, questions, input".

The Government officials, he added, "tended to be in that environment, subservient to the Minister".

Mr Goggin's recall of that night is in direct contrast to that of AIB.

He said there was "no ambiguity" by the end of the discussions that the Government was putting in place a blanket guarantee for all six major banks.

AIB representatives have already told the inquiry they only found out the following morning in media reports that Anglo and Irish Nationwide banks were to be included.

Mr Goggin said "yes, AIB was with us at that point" - in the room when the blanket guarantee was confirmed.

The former chief executive explained to the inquiry that the "entire day and the night" of September 29, 2008, "was the worst day of my life. It was incredibly stressful and traumatic".

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