Brian Lenihan Jnr (Dublin West, Fianna Fail)

No. The amount paid by the agency will be significantly less than this to reflect the loss in value of the properties. In the longer term, if the agency were to fall short of recouping all of the costs, the Government intends that a levy should be applied to recoup any shortfall.

All borrowers will be required to meet their full legal obligations for repayment. There will be a hardening of the approach to these borrowers. Taxpayers' money is at stake - not the private interests of banks - and the agency will be expected to protect it in a commercial way and with an independent remit.

It is important to note that the State will not assume all of the risk in the acquisition of these assets. The assets will be valued on a basis which is sustainable for the taxpayer. This will entail an assumption of losses by the financial institution whose assets are removed. The State has already capitalised the Bank of Ireland for a 25% stake and is completing due diligence at Allied Irish Banks prior to capitalisation for a similar stake. If the crystallisation of losses at any bank requires additional capital the State will insist on participation by way of ordinary shares in the relevant institution.

This initiative will be developed and implemented within a common EU framework detailed in the European Commission guidance on the treatment of impaired assets, working closely with the European Commission to obtain prior State aid approval. By drawing on the best advice and experience available internationally, and on the proven expertise and ability of the National Treasury Management Agency, we are committed to ensuring that this very significant measure will be an example of best practice and will meet all of the objectives that the Government has set for it.

Leaders throughout the world speak of the need to clean out the banking system of exposures and we, on our own initiative, are participating in the international trend, leading it with a distinctive solution which is tailored to our needs.

See this speech in context