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Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: Well, I'd say Mr. O'Connor is a highly qualified man. I'd say-----

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: With due respect, Chairman, right, Mr. O'Connor was the only third-party person that would have looked at the balance sheets of the banks and their loans in the nine days up to - well, not quite nine, but certainly up to six or seven days up to that date-----

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: Prior to the guarantee being put in place, was Anglo and Irish Nationwide solvent?

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: Sure that's why I'm asking the question.

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: And what contingency plan did you recommend be put in place?

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: So, technically, prior to the night of the guarantee, technically, was Anglo and Irish Nationwide Building Society - I suppose, Anglo in particular - was it insolvent?

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: And if you'd been asked on that meeting of 25 September whether Anglo or Irish Nationwide were solvent, what response would you have given?

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: So therefore, technically, prior to the guarantee it wasn't solvent, they were insolvent.

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: Can I just go back to the ... by the end of 2013, €64 billion in the six financial institutions, can you comment on the capital adequacy of the Irish financial institutions, risk over-concentration in property and land and development, arrears identification, interest roll-up? And, in your PwC report, you stated that - this is core document Project Atlas 1, Vol. 1:The latest available...

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: No work. And did you at all, when you had initially looked at the ... in Project Atlas 1, you reported on that on was it 27 September, am I correct?

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: Second week of October. Did you advise the Financial Regulator and the Government that there was a need for more in-depth review of the loans of the banks?

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: Yes, but you still relied on management for Atlas 2. I mean, you relied, we'll say, on the ... did ye do any, I suppose, drilling down that, we'll say ... the fact that, subsequently, we'll say, there was results done by the Financial Regulator back in 2011 ... 2010-11, where it showed that the banks needs €24 billion. The question I'm asking is: being the professionals that you are,...

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: Okay, Mr. Walsh.

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: Is it fair comment that the 4% potential reduction ... fall in the value of commercial property that you sought from '08 to 2011 in Project Atlas 2 grossly understated the fall in property ... commercial property as it happened over that three-year period, and if you had put in any ... what level of fall in ... in property prices would have given rise to a situation where you would not have...

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: I suppose, the question I'm asking-----

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: It is a very simple question, Chairman.

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: No, but, Chairman, I just want ... It's very simple. The 4 ... what level, if it had been 6%, 10%, ... at what level would all the banks have breached their core tier 1 requirements and you would have stated that the banks needed capital?

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: At 4%?

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: So ... but you didn't say that.

Committee of Inquiry into the Banking Crisis: Nexus Phase (9 Sep 2015)

Kieran O'Donnell: Can I refer back to Vol. 1, page 5, and can I direct Mr. O'Connor and Mr. Walsh to scenario analysis, scenario 1 and scenario 2. Am I correct in saying that ... is scenario 2 the higher case scenario? Is scenario 1 or 2 the worst-case scenario? I know they don't want to use the worst-case but just-----

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