Professor Patrick Honohan:

My view is that there will be many cases in which there will be permanent loan modifications which involve in some cases, reduction in principal, in other cases, a permanent reduction in interest, etc. That may not be what those gentlemen are referring to. They may have some refined view of what is "debt forgiveness", but my plain understanding is that there will be many cases, although not a majority, in which there will be such permanent loan modifications involving a reduction in principal and-or interest, including cases where there are two-tiers where the second tier might come back at some stage. The Central Bank will not be satisfied with a situation where the banks continue to deal with cases that require a permanent modification as if they were cases that could be fully serviced without any loss of interest because there will be many such cases.