Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

This question relates to the recent Asset Quality Review of the main Irish banks which is a precursor to the European-wide stress tests next year. My concern is the element of uncertainty created following the announcements by the banks of the affect of the outcome of that review on their balance sheets. All of the banks have stated that they are still above the minimum regulatory capital levels, which is accepted. However, there appears to be a variation between the Central Bank's interpretation of Bank of Ireland's balance sheet in terms of its provisioning for loan losses and the bank's own interpretation in this regard. Bank of Ireland has also stated that engagement on that issue is ongoing.

Having the minimum level of capital does not mean that a bank is properly capitalised to meet the lending needs of the economy. It is important that in advance of the full stress tests later this year we have absolute clarity as to the state and health of the balance sheets of the main Irish banks, on which we rely to provide the oil for the engine of the Irish economy.

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