Richard Bruton (Dublin North Central, Fine Gael)

I will be brief. My amendment deals with banks which are currently facing difficulties and have many intensive care loans. We are told that estimates have been made of how many loans are non-performing. It is very important, now that the taxpayer is effectively the guarantor for deposits, that we have some solid assurances that work is being done within the banks to restructure their loan books. The Minister correctly said that if a bank is currently seeking capital it is very difficult to get a rights issue. On the other hand, we have seen that very significant sums can be saved for restocking the banks by stopping dividends, for instance. The dividends in recent years have been as much as a billion in some major banks and that can contribute very significantly to rebuilding the capital base. If banks who have the benefit of this guarantee have a difficulty in their capital base, we the taxpayers will be in line to try to deal with the mess. We need to have assurances that the banks are applying rules in relation to putting money into capital that is correct and appropriate. If banks have impaired capital bases which need to be restored, they should not be paying dividends or bonuses. They should be curbing the pay of senior executives so that we can do everything to repair the capital base and ensure there is not a solvency issue that is being left unattended, confident in the knowledge that the liquidity problem has been solved. We have to be confident that the solvency issues are high priority and that everything reasonable and appropriate is being done.

The purpose of our amendment is to put the Minister, his appointee to the board and the regulator in a position to restrict the payment of dividends, bonuses and any other moneys, including remuneration. While I might not be as prescriptive as Deputy Burton in her amendment, I fully understand the sentiment. We need to see the banks rolling back their pay settlements for senior executives in the light of the very grave situation which has led to this extraordinary action.

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