Michael Noonan (Limerick City, Fine Gael)
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The European Stability Mechanism, ESM is a new institution. Its primary function is to act as a backstop to protect the euro currency in the event of another currency crisis across the Union. In addition to that, as a result of discussions at Eurogroup and ECOFIN level, an additional set of powers was attached. Those powers were to do with the recapitalisation of banks. The European Stability Mechanism was empowered to recapitalise banks directly. The significance of doing this directly is when the European funds recapitalised the Irish banks, it was done through the sovereign. The money was assigned to the sovereign Government. The same was true in Greece and Portugal. What is in question here - the "directly" - is that a bank would be directly recapitalised. Of course, the whole methodology of resolution has changed in Europe. The policy has done a 360° turn, or a 180° turn, or whatever is the opposite point on the circle.