Ireland 'took one for the team' on debt, says Noonan

Minister for Finance Michael Noonan said the Government has a "strong case" to win a refund from Europe's rescue fund for the money it spent on recapitalising Ireland’s banks.

German chancellor Angela Merkel and French president Francois Hollande have called Ireland a "special case," signaling it will be "looked after," Mr Noonan said in London today when asked if the European Stability Mechanism could be used to retroactively pay for Ireland's bailout.

"I think Ireland has a very strong case,”

[ he told Bloomberg TV. ]

Mr Noonan's comments come two weeks after the Government secured a deal to stretch out the cost of rescuing the former Anglo Irish Bank, which he said removed a "millstone" from taxpayers.

Mr Noonan said European leaders have acknowledged that Ireland had a "heavy imposition" placed on it.

"While some of it was our own fault, a lot of the action was taken at the direction of the European Central Bank to prevent contagion spreading to the European banking system," Mr Noonan said "As Ronald Reagan used to say, 'we took one for the team.'"

Ireland sought an international aid package in 2010.

Mr Noonan said today the Government is making progress and aims to sell longer-term debt in the first half of this year so that it can have the ECB bond-buying program as a "backstop" to reassure investors.

"I don't think we'd apply to avail of it," he said. "We'd apply to use it as a backstop so that we could access the market, so that lenders would know that it's there."

On the restructuring of the Anglo Irish debt, Mr Noonan said there is "no suggestion" the agreement will be unwound.

He also said he was not surprised by the comments on the deal by ECB Governing Council member Jens Weidmann.

The Bundesbank president said the transaction on the Irish promissory notes comes dangerously close to contravening a ban on the monetary financing of governments.

Discussions "had been going on for several months" and the deal could not have happened unless agreed by all ECB council members including Mr Weidmann, Nr Noonan said.

"They didn't challenge the fact that it was done and that it was in accordance with the treaty," he said. "No rules were broken"

Noting "the change in attitude" from investment agencies and from the sale of Irish Life, Taoiseach Enda Kenny said the impact of the deal on the promissory note was already evident.
"The ECB, of course, has a requirement to monitor all of the activities of national central banks who have arrangements with the European Central Bank and that applies in the case of Ireland," he said.
"We have moved on. Clearly the benefits are already beginning to show in terms of international reputation, attitude and indeed the reflection in continued investment."