Mr. Diarmuid O'Flynn:

The Senator's final question goes back to what I said already. The reason they thought it was a liquidity problem was because that was what was presented to them by the auditors and accountants of the banks. They did this because they were using historic valuations. They were not using the true and fair valuations. They were presented with a false picture. That is why they thought it was a liquidity problem when actually the banks were insolvent. We cannot blame them because they were presented with a false picture, because of the accounting standards that were used, but they did not comply with the law.

On the other issue, Deputy Pearse Doherty already referred to the changeover in 2012 by the then Minister, Deputy Noonan. That is when this could and should have been challenged, because at that stage it was not actual Government debt. It was on the basis of a promissory note. It was at that stage the ECB should have been challenged and told we are not doing this and that we would simply not destroy €3.1 billion every March. The ECB should have been challenged at that point because Ireland had the high moral ground. In addition, the ECB was very vulnerable at that time. It was still in panic mode and searching all over. It was blindly reaching all over the place. Ireland was in a very strong position at that stage. Instead, what the then Minister, Deputy Noonan, did to alleviate his own financial position - he was taking €3.1 billion out of the spending every year simply to alleviate his own position as Minister for Finance - was that he restructured. The value was not dropped by 1 cent. He restructured what remained of the entire promissory note and kicked it out to be paid by future generations. It was a sell-out of future generations of massive proportions. He did not have the bottle to take on the ECB, which he should have done. He was in a strong position to do so.