Shane McEntee (Meath East, Fine Gael)
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Question 45: To ask the Minister for Finance his views on the concept of a living will for financial institutions as a way of limiting the exposure of the taxpayer to bank difficulties in the future. [44827/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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In the light of events which have arisen in the context of the international financial markets crisis, the concept of 'living wills' or recovery and resolution plans for financial institutions is being examined in a number of international fora. At EU level a recent Commission Communication on a EU framework for cross-border crisis management in the banking sector suggests powers for supervisors to require the preparation by systemically important institutions of firm-specific contingency and resolution plans. These plans would detail how an institution and its business might be wound up rapidly and in an orderly fashion. Ireland is, of course, participating fully in the work at EU level to examine this and other possible elements of bank resolution toolkits in a cross-border context. At their April 2009 meeting, G20 leaders endorsed a set of principles from the Financial Stability Board which include strong encouragement for financial institutions to maintain contingency plans and procedures for use in a situation of distress.

In my speech on the Second Stage of the NAMA Bill I indicated that I was examining options for the introduction of a legislative regime to deal with distressed financial institutions. The objective will be to ensure that the State has in place a range of tools to protect deposit holders and ensure financial stability and maintain international market confidence. My deliberations in this regard will be informed by the work underway at the international level on resolution regimes for the banking sector including in relation to recovery and resolution plans.