Implementation of the programme is going well. We are working out of a very deep hole and making real progress. We do not need to scupper our recovery, the goodwill generated or alienate our partners by taking unilateral action which in the medium to long term would prove wholly counterproductive. If we were to postpone or suspend payments to creditors in the IBRC, that would have a significant impact on both the bank and, ultimately, the State. Meeting this senior debt - unsecured as it is - is an obligation of the bank. If it did not meet such obligations, it would lead to a default and following that, most likely, insolvency, which would result in a significant increase in the cost to the State to resolve the IBRC. In such circumstances the State's negotiating position would, contrary to what has been suggested, be seriously weakened, if not wholly undermined. Furthermore, the financial market's view of Ireland as a place in which to do business or invest would be seriously undermined.

See this item in context