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Ireland wants to co-operate with other European Union member states, but it "simply had to move" last week to safeguard Ireland's banking system, Taoiseach Brian Cowen has said.

Questioned about German Chancellor, Angela Merkel's unhappiness at Ireland's unilateral move, Mr Cowen events "were taking place which were putting at risk the whole financial sector. We simply had to  respond."

"We seek to deal with this matter in as co-operative a way as possible, but there are certain issues where our national interests were at stake and we simply had to move."

Today, the Minister for Finance, Brian Lenihan faces questions from fellow EU finance ministers when he attends the ECOFIN meeting.

However, the credibility of the German criticism of last week has been damaged by Chancellor Merkel's decision yesterday to guarantee German bank deposits.

Speaking in Dublin this afternoon, Mr Cowen said the Irish Government had to "defend the stability of our own financial system, but, hopefully, we (can) at a European level and a wider global level find a means by which this problem is resolved."

The full terms and conditions of the Irish offer to banks may not be ready for publication later this week, Mr Cowen indicated, when he spoke at the Royal Hospital, Kilmainham.

Questioned about criticism of the Financial Regulator, Pat Neary, Mr Cowen offered a defence: "In fairness, I think the Fin Reg and the IFSRA system was a system that was devised in recent years to try and
modernise the regulatory framework.