Arthur Spring (Kerry North-West Limerick, Labour) | Oireachtas source

For both institutions. Were there terms and conditions attached to the giving of those funds? We hear quite often, particularly from Bank of Ireland, that the bank was provided with funds from the Government for the purpose of recapitalisation. We are told Bank of Ireland is repaying those funds and doing so at a profit to the Central Bank and State. I have a fundamental problem with that. We might be able to address the mortgage crisis partially through this. I would have believed recapitalisation was for the betterment not of the shareholders but of the citizens of the country. The fundamental role of a board of directors is the protection of the shareholders according to its fiduciary duties. However, when a state steps in and recapitalises the banks, it does so for the betterment of the public so any funding provided to recapitalise banks should be provided with strict conditions attached. There should be no early repayment of the loans. What I propose should be done particularly for the purpose of debt write-down.

In some of the questions, particularly those of Deputy Donnelly, I noted the view that an interest-only mortgage is an acceptable form of functioning loan. I do not believe it is acceptable that somebody could be in debt for 30 to 50 years in some cases and paying off large amounts of interest although not having an asset at the end of it. There has to be capacity to pay and to be released from the debt.

If I were to ask a question on the recapitalisation of the banks in particular, I would ask what conditions were attached, whether the Central Bank understood it was for the purpose of writing down debt and whether it would involve a liability on a balance sheet for the medium and long-term for the institution. From my perspective, the only people who have been fundamental winners consequent to the recapitalisation of the banks by the Government in 2011 are the shareholders. We have seen an exponential rise in the share price, particularly in Bank of Ireland.