Michael Noonan (Limerick City, Fine Gael)

It was directly related to a decision that Europe should try out burden sharing in the banking sector in Greece, which was done. Mr. Trichet advised strongly against it, but the political side took the decision and that is what happened. It is very difficult to say now that Ireland should go down the same road.

In addition, there is now very little distinction in Anglo Irish Bank between guaranteed and unguaranteed bonds. The guarantee introduced by the previous Government was the greatest financial mistake ever made in this country. It was guaranteeing a private bank, Anglo Irish Bank, that was still operational. However, some months later the Government took over that bank and then it became a State bank. When it became a State bank it did not matter whether the bonds were guaranteed or unguaranteed because the signature of the sovereign was under the bonds in the bank as soon as it became a State asset. It is a false distinction to talk about guaranteed and unguaranteed bonds in Anglo Irish Bank because they both carry the State signature. It would be greeted as a credit event if there was coercive imposition on that and, as a credit event, it would ruin the good reputation we have developed in recent months-----

See this speech in context