Mr. Pat Farrell:

Well first of all, when the guarantee was announced, it was apparent obviously that only the domestic Irish banks were included in the guarantee. The joys of representing a broad church of membership, obviously I had a number of quite irate members. First of all, you had the banks who were operating in the retail domestic market here but had a foreign parent. They were naturally, as you can imagine, they were quite annoyed. They felt that they were being placed at a disadvantage so they ventilated their concerns to me quite robustly. Then there were the two banks, Depfa and WestLB I think, if I recall them correctly, in the IFSC who had been availing of and using the covered bonds programme that I mentioned, which had its origins in the 2001 Act. They had been using that programme to issue bonds, finance and public sector assets, for quite some time and they were outside of it. Then there was the added complication that Depfa, and this is well chronicled in the public realm, was for a short period of time seen as an orphan in regulatory terms because it wasn't clear whether it fell within the ambit of the regulatory authorities here or Germany, although I think with the benefit of hindsight it was very clear that it fell within the German responsibility because it had been acquired by a German bank some time previously. So they were also concerned and that was the context for the note to Dermot McCarthy.