Brian Lenihan Jnr (Dublin West, Fianna Fail)

Then Deputy Burton is suggesting that the balance sheets of the banks should be revised as to assets and liabilities. Capitalisation is done in financial institutions by raising equity and if the taxpayer does not put in the equity, the markets must put in the equity. The normal method of recourse for the banks is to make a rights issue and seek subscription from the public. However, as we know from this worldwide banking crisis, several financial institutions have had abortive rights issues and a judgment would have to be made as to whether a rights issue by the relevant commercial institution will be of benefit to it. That is a matter which can arise in the course of the implementation of this Bill, but it is not a matter which will arise in the scheme that will be submitted to the House next week. The State will not require an institution to conduct a rights issue and neither will the State commit taxpayers' money to the equity in these particular financial institutions. Therefore, the question of capitalisation does not arise in the scheme next week.

The other issue raised by Deputy Burton is the question of the assets and liabilities of the bank. When she refers to capitalisation, I think she is suggesting that the assets of the financial institution should be redefined. In the first instance, that is a matter for the auditors of the relevant institution and for the proper auditing and accounting practices that apply to that institution. An examination of this matter will be part of the involvement of the State with these institutions. However, I think I am right in saying it is not a matter which directly arises in the scheme which will be submitted next week.

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