Fears over roll-back on promissory note agreement dismissed as 'fanciful'

Mon, Feb 18, 2013, 00:00

Minister of State for Finance Brian Hayes has dismissed as “fanciful” reports the promissory note deal could unravel.

Bundesbank president Jens Weidmann recently voiced concern that the deal came perilously close to illegal monetary financing, while former ECB president Jurgen Stark said the arrangement contravened EU Treaty rules.

Mr Hayes yesterday insisted the arrangement would continue as planned.

“The promissory note arrangement is solid . . . the notion that in some way there isn’t a deal here, there isn’t an agreement, is just fanciful,” he said, speaking on RTÉ’s The Week in Politics programme.

“Every serious economic commentator has welcomed this arrangement . . . because it gives us breathing space and flexibility.

“The suggestion now that there’s no agreement . . . is utterly ridiculous. We have an agreement, we have an arrangement and, more importantly, that arrangement will lead to significant benefits for this country in the short, medium and long term.”

‘No concerns’

A Department of Finance spokesman said the department had “no concerns” in relation to comments made about the deal over the weekend. Referring to ECB president Mario Draghi’s remark that the bank “unanimously took note” of the plan, the spokesman said: “We fully respect the ECB’s right to continue to monitor to make sure everything is done in accordance with their rules.”

He added: “We are working to implement the deal now.”

IBRC legislation

Meanwhile, the department declined to comment on reports that the legislation brought forward to liquidate the Irish Bank Resolution Corporation would have to be changed.

The legislation put a stay on all legal actions taken against the bank, including that by the Quinn family.

Sinn Féin’s spokesman on finance Pearse Doherty renewed his attack on the promissory note deal yesterday.

“What people wanted was a write-down of this debt,” he told RTÉ.

Meanwhile, Fianna Fáil spokesman on finance Michael McGrath called on the Minister for Finance to clarify the impact of the liquidation of IBRC on credit unions holding investment products with the former State-owned bank.