Brian Lenihan Jnr (Dublin West, Fianna Fail)

I can arrange for that information to be furnished to the Deputy, but the point I am making is that we are not unique. There is a constant suggestion that there is something unique in what is happening in Ireland regarding the banking crisis. There is not. Constant interventions by the Government and Parliament are required to protect the position.

The amendments tabled this evening are grouped. Deputy Bruton seeks to insert a new section 3, to restrict the scope of financial support that may be provided under the Credit Institutions (Financial Support) Act 2008, as amended by this Bill. It prohibits the extension of financial support that may be provided under the Act to any form of tier 1 or tier 2 risk capital.

As the Deputy is aware, regulatory capital comprises tier 1 capital, which is largely equity and reserves, and tier 2, which are longer-term instruments that have the capacity to absorb losses, such as the subordinated debt instruments referred to by Deputy Burton. Current EU state aid requirements set down strict guidelines for the material scope of guarantees or the types of liabilities covered and any scheme providing financial support under the 2008 Act must receive State aid approval. That will be worked out in the context of the scheme which will be submitted to the House and upon which it can make a decision.

I accept the reasoning behind Deputy Bruton's amendment, which conforms to what would be required under current EU state aid rules, but I would be very wary about specifying in primary legislation restrictions of that type. As I indicated already, I am open to ensuring that the appropriate definitions are inserted in any scheme under the legislation. The Deputy's other amendments concern Schedule 2 of the Bill and the changes in the period of financial support.

Deputies Morgan and Burton propose, in effect, to delete the proposed changes in the Bill to the 2008 Act and Schedule 2, Part 2 of the Bill amends the bank guarantee legislation to allow for the extension of the financial support scheme, subject to EU approval. The draft scheme providing financial support beyond the expiry of the current guarantee would be in line with the credit institutions financial support scheme in 2008 and would require positive approval.

I have made clear on a number of occasions, including in my budget speech which occasioned very little response, that the Government intended to put in place a guarantee for the future issuance of debt securities, with a maturity of up to five years. Given that every other country in the EU that adopted a guarantee is doing it, it is hardly remarkable that we should at least allow ourselves that facility and empower ourselves to do it, otherwise our banks are not on a level playing field, as far as our EU partners are concerned. Access to longer-term funding is in line with the recent mainstream approach in the EU and will support the funding needs of the banks.

A new section 6(3)(a) is inserted into the 2008 Act to give us that power, and Deputy Morgan proposes to delete it. He also proposes to delete from the schedule the new section 6(20). It is a technical provision granting a very limited decision making power to the Minister to resolve any ambiguities in the administrative terms of the credit scheme within the purposes of section 6. It is to remove any potential ambiguities arising in the administration of the scheme as to what debts, liabilities and borrowings fall within the determinants of the scheme. It is necessary because of the diversity of instruments in financial markets.

Deputy Bruton also proposes to delete the sentence, "The Minister's determination is conclusive", but the meaning of the phrase in the Bill is that the Minister's determination is conclusive between the parties only. Clearly, any interpretive issue would have to be left to the courts.

Apart from the amendments, Deputy Burton went over a large piece of ground. The foundation of her speech was a suggestion in a newspaper article that a 16% discount was what was being sought in the NAMA operation. My Department does not brief newspapers on an unattributed basis. That is pure speculation by a particular journalist in a particular newspaper. The reality of the position regarding valuation under NAMA is that Deputy Noonan is correct. We have fundamental decisions to take. That is why, on the issue of valuation, we must proceed with extreme care and caution. I have said this consistently since the budget. The NTMA has retained HSBC as its adviser on the valuation methodology, which is yet to be finalised. One point is fundamental regarding the valuation methodology and is insisted upon by the EU authorities, that is, that each valuation must be of an individual asset. There cannot be a collective valuation of the assets.

It is true that when all the assets are valued, a collective figure can be totted up. However, the valuations have to proceed on an individual basis and that is an EU requirement. I do not propose, at this stage, to have a discussion which lies on the foundation of a newspaper report about an alleged discount which will be applied because the valuation methodology is still to be determined. There is no hidden activity taking place in my Department in that regard.

I would be more than pleased to arrange for Deputies to be briefed by the NTMA and my Department on these issues. The NTMA accompanied me recently to a parliamentary committee where there was extensive questioning on these subjects. It is working very hard to ensure this matter is brought to a completion as soon as possible.

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