Mr. Niclaus Bergmann:

I think we can support and strengthen the credit unions with our public banking system. The commercial banks will probably feel increased competition, which is bad for an individual institution but good for society.

Asset liability management is the answer to the first question. We have a system in place in Germany such that the regions where there is more funding and more deposits can transfer this inside our system to those Sparkassen which need more funding. This transfer of funds can be done within the family. It is quite easy to organise. The region that gives funds to another is compensated for that. There is an internal mechanism that should work quite well.

The cost to Government is a question of what the model would look like, whether there will be a permanent involvement of the central Government or other providers of capital. I would like to see some of the capital coming directly from the region. There has to be regional ownership. There have been regional institutions which also provide some capital. It does not make much sense when a decentralised system is only funded centrally. From a logical point of view, a mixture has to be found but all of this can be discussed in a working group. We have some ideas for Germany but it has to be an Irish solution. This can be developed in a proper working group.