Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

Thank you, Mr. Doyle. When Governor Honohan attended before this inquiry and he clarified some evidence subsequently in writing on the question of what should have been done with Anglo Irish Bank and Nationwide, he set out a hindsight scenario. And I want to put that to you ... and that hindsight scenario is on the basis that you now know the cost to the State of rescuing Anglo and Nationwide will be in the order of €35 billion. And in that hindsight scenario, his view is that although Anglo was systemically important at the time, the Government would have done better by not including those two banks in a guarantee. It could have advised the ECB and the European Commission that it intended to liquidate these banks, protecting only insured depositors. European officials would have been shocked, they might possibly have agreed to some risk-sharing arrangement to induce the Government to refrain from the bail-in and absent from such a risk-sharing agreement and notwithstanding the associated significant reputational damage, on balance, some bail-in should have been applied. My question is, with the benefit of hindsight, and given we now know the cost of rescuing those two banks is of the order of €35 billion, should a different decision have been made regarding Anglo and Nationwide?