Morgan Kelly in Shorthand

Anglo Irish bank – bailout cost €34 billion
On same assumptions – Allied Irish bank €26 billion
Bank of Ireland €16 billion (that is deducting the €3 billion from investors)

Total bung = €76 billion

In September 2010, the banks repaid €55 billion in bonds to (UK, German and French banks) with borrowed ECB money guaranteed by Irish government

The bank guarantee could have been legally terminated because of withholding of information on their insolvency insolvency and consequential breach of the 1971 Central Bank Act. The government could have passed an Irish version of the UK’s Bank Resolution Regime and turned the €75 billion of outstanding bank debt into shares in those banks and ending the banking crisis at a stroke. This would have shared the costs with the bondholders. The consequence would have been a major row with the European Central Bank.

Conclusion : Clubability of the political elite – great guys in Europe but muck at home.

Question. Was such a scenario considered in the Department of Finance? Is there documentary proof of this?

If it was not, what has Dr Alan Aherne from UCG, ministerial special adviser got to say about this?

I told my readers before that Lenihan and co were looking for peer group approval psychologically. I have no doubt that this is true.

Fogra: Please learn from Thatcher. You look after your own country by not being fawningly nice. (ps, I don’t like Thatcher or Thatcherism but she did have a few good points politically.)