Professor Alan Ahearne:

I do not think so. What if the bank had been liquidated? In a liquidation all unsecured creditors must be treated equally.

The liquidator could not have told bondholders he was going to give them nothing back but give all the revenues from selling the assets to the depositors. Maybe the State could have made good all the depositors but we would still have diluted the losses that could be forced onto senior bondholders by the fact that there were depositors. It may have saved 50% or €5 billion of the total of €10 billion.