Bernard Allen (Cork North Central, Fine Gael)
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Question 38: To ask the Minister for Finance if he has met with the executives of building societies (details supplied) to hear their proposals for recapitalisation, for handling of liquidity and for impaired loans; and if he will make a statement on the matter. [12518/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Since the Government's guarantee Scheme was announced I have met on numerous occasions with representatives of all the covered institutions. The questions of capital, liquidity and loan impairment have been addressed at these meetings.

The Financial Regulator also enforces specific liquidity regulatory requirements and the issue of liquidity is a matter in the first instance for the Financial Regulator and the Central Bank. However, given the turmoil in financial markets in recent times, my officials are updated by the Financial Regulator and Central Bank regularly.

As the Deputy will be aware, the Government is reviewing proposals for dealing with the risks associated with certain assets including assets in the institutions concerned. I have asked Dr. Peter Bacon and the National Treasury Management Agency to report to me on this matter.

I have seen the initial report prepared by Dr. Peter Bacon for the NTMA. The report will inform the Government's ongoing considerations, involving the Financial Regulator, Central Bank, the NTMA and our legal and financial advisers.

Kathleen Lynch (Cork North Central, Labour)
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Question 39: To ask the Minister for Finance the models of bad asset support scheme under consideration by his Department with respect to reinforcing the balance sheets of credit institutions supported by the bank guarantee; the parameters under which these models are being considered; the advantages and disadvantages of these models in the Irish context; when he will make an announcement in respect of such a scheme; the way he proposes to fund it; and if he will make a statement on the matter. [12300/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The Government is conscious that in current market circumstances there is a need to bring greater certainty and transparency to the operations of systemically important financial institutions, in particular in relation to specific asset classes currently perceived as carrying a higher than average risk.

In this context, the Government is examining proposals for the management and reduction of risks within financial institutions with respect to these specific exposures, having regard to international developments. As part of this work I have asked Dr. Peter Bacon and the National Treasury Management Agency to report to me on the matter. I have seen the report prepared by Dr. Bacon for the NTMA. The report will inform the Government's ongoing considerations, along with ongoing work at EU and European Central Bank level. I will be bringing forward proposals in this area as a matter of priority.