Professor Patrick Honohan:

I did, sort of, sense that in the discussion with Deputy Doherty that there was ... that I seemed to be saying overcapitalisation. I was advocating at a certain point that there should be overcapitalisation. I was saying that what we did in March 2010 was not under-capitalisation - it was about right - and that a large part of what happened was because we were ... it seemed about right but then we discovered €8 billion of NAMA and then another €9 billion was put in because of what BlackRock did. BlackRock were more aggressive in their assumptions about what would be lost, particularly in respect of the deleveraging, which was also part of the sales of loans. They also required ... not BlackRock but the troika required us to reach a higher capital threshold. Now is that overcapitalisation? Well, not really because the international standards keep on moving up and pushing us up in that direction so I'm not sure ... I am very reluctant to talk about overcapitalisation. It would be very much in the bank's interests to say "Oh we'd like now to write back provisions and to claim that we've too much capital." I don't think they've got too much capital.