Professor Patrick Honohan:

In general terms I am aware of the discussions but I am not part of them because they do not involve the ECB. This is an intergovernmental matter. Certainly, the announcement after the euro area summit last June was a statement from which we took a lot of comfort. Ever since then we have been trying to find out how it will pan out. There have been fluctuations in the statements and drafts on different elements. To some extent, one of the benefits of the creation of the single supervisory mechanism is that it provides confidence to people in creditor countries who fear that they might have to pick up the pieces in the event of a future banking failure. The assurance that banks in other countries are being well supervised is a step towards providing the confidence that the ESM's involvement in capitalisation of banks could be more generous. On the question of the 4.5% and whether that winds back to what was put into the banks in 2011, who knows? What negotiators are talking about now is primarily the future regime. The discussion in June and the eurozone summit really referred to the previous position of the Irish banks. I do not know and am not going to suggest that we are clear on the previous activity. That is a discussion that will be had.