Brian Cowen (Laois-Offaly, Fianna Fail)

As the Minister for Finance has pointed out, we are preparing a comprehensive response to all of those issues. Today's issue, however, relates to the results that have arisen in AIB. Those results show that NAMA is forcing the banks to face up to the reality of their bad loans. Everybody knows that the banks loaned far too much to speculative property development. NAMA is making the banks take the losses on these property loans up front. That is what is reflected in the large losses that AIB is reporting. Without NAMA the banks would have inevitably tried to do what Japanese banks did in the 1990s, which was to spread out the losses over the next decade to the detriment of lending to viable small businesses and households.

I am glad to note that when he addressed the Committee on Finance and the Public Service earlier today, the Governor of the Central Bank said he believes NAMA and the recapitalisation of the banks will create the foundations for the recovery of banking. It is important to point out that from the Government's point of view, we stand ready if necessary to provide recapitalisation to the banks.

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