Mr. Edmund Honohan:

There was a concern when NAMA was incorporated or set up by statute about the reputation of the State, the bond markets, the ratings agencies and so forth. There was a concern that if there was too much of a concession given to strategic defaulters, the moral hazard problem would arise and that people would stop lending mortgages in Ireland and we would simply dry up. That has not happened. The rate of repossessions is still very low here, for reasons I might go into later. There is a kind of phoney war with the banks. The banks are at it again and they are lending money. They seem to be quite happy to deal with Irish home owners and borrowers on the basis of the existing legislation. Internationally, the bond markets are quite happy to lend to Ireland and I see no reason why a different view would be taken of a national co-op if it has sufficient industrial heft to be able to represent itself as a big player in the market.