Professor Patrick Honohan:

A system-wide guarantee was not unprecedented. In fact, it is the normal reaction of an unprepared public authority to say, "there is a problem in the banks, we will guarantee them." One can see this in history in respect of Japan, Turkey and elsewhere. The details of the guarantee are, of course, important because if instead of guaranteeing 440 one guarantees only 400, there may not be any net deficiency at the end. That is where the discussion about subordinated debt and the old seniors comes in.