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MINISTER FOR FINANCE Michael Noonan has announced the end of Bank Guarantee.
In a statement today, Minister Noonan said that the scheme will end on 28 March 2013. He said that the announcement came following a decision by the Cabinet.
The Bank Guarantee – the Eligible Liabilities Guarantee Scheme (ELG) Scheme – will end for all new liabilities from midnight on 28 March 2013.
Normalisation
According to Noonan, the ending of the ELG for new liabilities marks a significant step in the normalisation of our banking system.
He stressed that today’s announcement will not impact the vast majority of bank customers as their deposits are covered by the Deposit Guarantee Scheme or DGS – a separate guarantee which has been in operation in Ireland since 1995 and is part of an EU-wide arrangement for deposit protection.
The DGS covers deposits up to and including €100,000 per depositor per credit institution or €200,000 in the case of a joint account. The DGS also covers members’ savings with their Credit Union.
Commenting on the announcement the Minister stated:
The Irish banking system failed the Irish people and the mismanagement of the banks and the crisis has cost the Irish taxpayer €62 billion. All of the Government actions since taking office in March 2011, both at home and abroad, are designed to repair this damage and break the negative link between the banks and the State. We are making significant progress in this regard and the ending of the Guarantee for new liabilities marks another step forward.
The Government’s banking policy is a series of steps, all of which are interlinked:
Ending of the Eligible Liabilities Guarantee Scheme
This announcement also has a broader implication for the State by removing €73 billion of contingent liabilities from taxpayers. In return for guaranteeing such massive sums the State has received fees from the covered banks.
The Minister said that the department had assumed that the ELG Scheme would end in February 2013 and the removal of the scheme will have no negative impact of the budgetary position.
In fact, I am confident that the ending of the scheme and the gradual removal of this liability from the taxpayer will also help to sustain Ireland’s re-entry to international markets.
Fianna Fáil welcomed the announcement, but said it “should not be interpreted as meaning that the Irish banking system is fixed or functioning in a normal way”, according to Fianna Fáil finance spokesperson Michael McGrath.
He added that the banks must “get on top of the mortgage arrears and personal indebtedness crisis by putting sustainable long term solutions in place”.
Minister Noonan said in a press conference following the announcement that the next big project is to have AIB, Bank of Ireland and Permanent TSB “supplying solutions, particularly to people who have problems with their mortgage payments” under the direction of the Central Bank.
Staff have been trained and banks are ready to move forward with this, Noonan added.
AIB also welcomed the news, saying it “further demonstrates the ongoing improvement in the stability of the financial system in Ireland”.
David Duffy, AIB CEO, said: “We welcome the announcement today and expect that this move will have a positive impact on the operating performance of AIB over time as the bank returns to long term sustainability.”
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Too late, the damage is well and truly done. We’re left with the legacy of the guarantee for the next 40 years. Now enshrined as sovereign national debt.
Send your comments to: Micheal Martin, c/o: Fianna Fáil, 65-66, Lower Mount Street, Dublin 2.
John – or anyone who has an opinion – Agreed, alot of damage done!
However when Ireland doesn’t have to borrow to pay for current day to day expenditure (and hence has minimal dependence on the international monetary system for borrowing), cant we move to dump that “sovereign national debt” and burn who we like at that stage? Would the only consequence be the likely knock on difficulties in borrowing for further capital expenditures? Opinions?
It’s a sorry state of affairs and with no blame on anyone except stupid comments like “people went mad with borrowing” the culprits get away scot free thanks to a mountain of documents they pulled out of there arse. So litigation for the next fourty years, I must become a barrister or lawyer plenty of money will be flowing there way.
A lot (of damage) done, more to do.
“Fianna Fáil welcomed the decision”. Playing the game.
People didn’t go mad with borrowing. Banks went mad with lending.
If you borrow a thousand and cant pay, its your problem , if you borrow a million and cant pay its the banks problem. But if you borrow a billion and cant pay then its the tax payers problem . Ridiculous.
The 23 people who have given you thumbs obviously don’t inhabit the same reality as the rest of us…
Are you and your mates finished Noonan??
Are you finished going into criminal banks and making sure that they are allright for cash, so that they can balance their books and pay themselves huge bonuses?
(when you should be going into the household’s of their victims and making sure they have enough money to eat)
Are you finished using taxpayer money to pay Seanie/Fingers gambling tab??
(when you should be jailing them and compensating their victims)
Are you and Kenny finished using the phrase “Ireland pays the debts of criminal private institutions” as a negotiating tool??
(Whilst proclaiming to anyone that would listen that your people WENT MAD BORROWING MONEY)
For Dillon!
By making the debt sovereign, the option of burning the bond holders is now out the window. Another FG/Labour election promise to the Irish public down the drain.
Red thumbs I can live with. It’s the 25% that would vote them back in that worry me, Hugh.
afetr 4 years of watching this all unfold we the people of Ireland are the only ones thaat can really be blamed for letting this go on this long. We could have hit the streets many many times over the last 4 years as our sovereignty was sold out from under us and astronomical amounts of debt were dumped on us the people! This, while those who completely created this whole mess and those in positions of political, union or whatever power sat back and made money no matter which way the wind blew.
it didn’t matter, all that mattered was that we did nothing and practically nothing is what we did unfortunately, but never ever say it’s too late, or that the money has been paid out and is now gone to the bondholders, banks etc etc etc.
Yes, it maybe true that a loud of lunatics lent the irish central bank and anglo etc money to pay back (bailout) too much money that was lent to the irish central bank and anglo etc to cripple us with debt, but, that doesn’t mean we have to pay the damn money back if we never had a hand at creating the problem or any say in the debt being loaded onto the general public.
I don’t need to tell you why we need to hit the streets now because you already know! there is no more tomorrows as this problem only deepens and deepens every day, we need to act now.
Noted Noonan on 18.00 News this evening when asked about the promised banking inquiry said it would eventually happen, probably this year.
Well, I can tell you it will only happen when the legislation currently being drafted to limit the powers of any inquiry from investigating politicians past and present of any decisions made by them in connection with any bank deals done, is slipped through the oreachtis some night soon!
Sheep …? Baa …!
Not quite as easy as that Dermot. Even when we are out of the troika clutches we will still be borrowing on an annual basis as most long term debt is just refinanced with new bond issues. So credibility with the markets still important…unfortunately!!
Yes indeed. Damage is well done now. I used to have savings … now all I have is debt and an ever decreasing income F*ck ye badstarts for all you have taken from us . You can all go to hell .
Does your bank or financial lender have a current, up to date and valid Banking license? Seems most banks if not all in Ireland are operating without one? Is this true?
Would you look at the smirks on the other pair hanging on the wall behind him.
The one on the left will be laughing into his pint for many years to come at our expense unfortunately.
well observed! hah!
Can they start paying back all they millions the they owe us
Very ironic ..
End of bank guarantee but they bondholders will still get paid.
You can bet your bottom dollar
Literally :(
What does it matter if it’s running out on March 28th anyway? The damage has been done. Emigration by the hundreds of thousands, dole queues longer than airport runways and suicide through the roof.
Besides, if any other financial institution should get into more trouble in the next few months or years, don’t worry because your buddies in the Dáil can have you saved overnight by rushing through legislation in a matter of hours without consulting the people who voted them in and the consequences it might have on them.
Oh, but if you want to tackle the issue of abortion, that issue will be left to fester for a couple of decades and the death of an innocent woman means nothing flip all because nothing has been done about it at all yet.
Banana Republic is an understatement.
Banana Republic that can’t even afford the feckin’ bananas !
Yet we can afford the monkeys in government?
Another step in the right direction, one no doubt that will be ignored by an amnesiac electorate.
The State received over €800m from the two pillar banks last year in ELG fees, this lost of income is virtually same as saving made on promissory notes so will be interesting to see how this effects the budgets going forward
Stephen be quiet. Journal readers don’t want to hear things like that. Just put your boot into the bondholders and watch the green thumbs roll in.
Declan, the journal readers dont want to hear ANYTHING from mister former special advisor to FF Kearon, full stop!!
Pillar banks my arse!
Declan, Stephen was part if the cabal that messed up the country in the first place. He was Dick Roche’s right hand man.
DECLAN – CATCHED!!! Vested interests really need to declare their interests :)
What was the point of extending it just a few weeks back? Hmmm? Looking after those mates again bilderberg Noonan Hmmm #FollowTheMoney
Yup. Its all done now.
Brian Cowan and Brian Lenninghan are the two biggest traitors this country has ever seen. If they had done it a 100 years ago they would have be hung from the gallows
*Lenihan, also the man worked to try repair what they had done until he died, literally.
Wonder what in the name of jesus would all the moaners be moaning about if the economic downturn never happened?
The price of decking
Great point there Daniel, little tip no need to use moaners & moaning in the same sentence with get the point!
So the normalisation of the banking system via the nationalisation of its debt.
I think people are justifiably annoyed, maybe when you actually realise what’s going on, you may also be somewhat perturbed!
Wake up!!
Looking for a free quote on that decking Mart ??
Ah here, don’t be so sour! I obviously used both words for dramatic effect!
That’s some image… Traitors’ trifecta.
Ha! You said it bro
Noonan the traitor get back in your box
So if there was a deposit guarantee scheme in place across the EU since 1995 then why did we have to bail out the banks?
Is it now a case that the war cry of “There will be no money in the banks!!” issued every time we needed to be reminded of why we are paying 3 Billion to the EU every year has been exposed as the lie it is?
Our grandchildren might still be paying off the debt imposed on this nation by the inaction of its leaders, but these leaders need to know that it is also our grandchildren who will judge them. So far it’s a fail.
It was a deposit guarantee scheme, but didn’t protect those that had lent to the banks, i.e. bondholders. The banking guarantee was initially sold to the Dáil by the Government at the time and the banks as a ‘liquidity problem’ rather than a solvency problem. It was justified on the grounds that if the government guaranteed any loans, then other banks would keep lending to Irish banks and that the banks would have enough cash to keep them going. But from the outset Morgan Kelly called this for what it was; a solvency problem: http://www.youtube.com/watch?v=11CCxv2ueiQ
I’d be very interested in the proposed inquiry into the banking guarantee that the current Government announced they were setting up to see what actually went on that night.
Hot off the printing presses! President Obama has persuaded Kenny and Noonan to guarantee the US deficit. We bail out Europe, then we bail out the USA and for the next trick Ireland will put a man on Mars by 2038.
It was all a dream.
The residential property market is recovering, the banks are solvent now and there is no longer a mortgage debt arrears problem.
@Peter, and the Easter Bunny is bringing us all golden eggs this year so we can pay off our debts (or the bondholders debts – bless them).
@ Pat, chuckling!
prepare for the next election ….with a new party. Its our only hope of getting justice and having a future. There are enough people to at least try, some are on this site. Its the only answer to the misery and mystery we are all enveloped in. Think about it peeps …..
Yes, New Fianna Fail. I can see the posters now.
Come on, the only way they can prove they are sorry properly is if they are re-elected to Govern.
The timing will be about right for a classic FF return to power. All the dirty unpopular fixing will have been done by FG, banishing them to political oblivion, and FF will romp home at the polls with promises of cancelling the property tax, 2-for-1 savings schemes, tax cuts, easy credit and a hospital and garda station in every town.
FF got the magic potion, and they’ll be wafting it under our noses some day soon.
I predict a bevy of very attractive lady FF candidates will start the initial electoral fluffing.
Direct Democracy will never work in Ireland because the vast amount of Irish people are only interested in their own pocket and will never vote in favour of anything that might be tough in the short term but in the country’s long term interests.
I’m sorry but why does anybody believe that the Irish public which voted FF back in time and again are suddenly somehow mature and wise. FF almost wrecked the country back in the 80s and when we finally got ourselves out of that mess in 90s, the Irish public voted them back in again because they promise everybody large tax cuts. The kept getting back in after that because they kept on fuelling a property boom so that they could continue to give away large amounts of tax and the majority of the Irish electorate continued to buy it even when people were warning that it was unsustainable.
The Irish have never shown that they are in any way capable of moving past short-term, parish-pump, what’s-in-it-for-me politics. So while the concept of direct democracy may sound great it would probably end up bankrupting the country far more than any political party ever could.
Everybody moans about party politics but fails to accept that the politicians we have are a reflection on us as a society. Ireland has a long long way to go before I would trust the Irish people with direct democracy.
B, did you even read the article ?
I read it and all I can say is
Oh, very fcuking funny Noonan!
Yes, the bank guarantee will end.
So if your bank collapses and you are unlucky/lucky enough to have over €100,000 on deposit you will not be reimbursed the balance in excess of €100,000 BUT
If you are a bondholde who invests in a bank you will be repaid the lot by someone who doesn’t owe it to you in the first place.
You satisified now that I read the article.
Clearly the best way to protect your savings is buying bank bonds, preferably senior.
Only an eejit would put money on deposit or buy bank shares.
Anyone can be a bondholder.
The stable door is quietly bolted long after the horse has bolted. The horse is now in your 100% Irish beef meal which is about as genuine as a pre-election promise. “Not one more cent to Anglo”. To think that they are looking for kudos now by finishing the bank guarantee when all their golf buddies and fellow bilderbergers are paid off is so tragic, it’s not even funny. They must really rake us for COMPLETE fools.
How is the liability removed from the tax payer, with 62 billion yet to be repayed?
The bond holder,s are safe , are we though , I wonder
“All of the Government actions since taking office in March 2011, both at home and abroad, are designed to repair this damage and break the negative link between the banks and the State. ”
Since taking office, this government has RENEWED the same bank guarantee after it had been proven to be a catatrophe and, after their pre-election lies, pumped several trillion red cents into failed banks. They have refunded the gambling losses in full of every single senior bondholder, regardless of whether they were guaranteed or not. Now they’ve turned the promissory notes, which Noonan himself admitted were “totally illegal” (and so could potentially be torn up) into sovereign bonds (and got their mouthpieces in the media to tell us what a great “deal” it was). In other words, they’ve done the complete and utter opposite of breaking the links between the bank debt and the State
At this stage most of the original bondholders have been paid off, so this has been done not with the Irish people, but, as always, the banks in mind, as they won’t have to pay the State the billion or so p/a for being covered by the guarantee, but will still be safe in the knowledge that their cronies in government will bail them out again with our money should they need it.
If there was any justice, all the parties who were involved in bringing in and renewing the bank guarantee (FF, FG, Greens, the dregs of the PDs and the sell-outs in Labour) would be prosecuted for treason, or gross negligence at the very least.
A funny time to announce this , could it mean that a lot of the overpaid who accepted the new arrangement,s are screwed now as they are the only ones likely to have €100000
Just after the Government makes a deal to make their debth our depth, the Gobernments then announces that our money is now their money.
Can’t stop laughing at the image of FG Noonan with the 2 previous FF finance ministers on his shoulders lol
The horse has bolted and is in multiple lasagnes across Europe.
#FollowTheMoney
so now the only chance of getting anything in return from the banks is gone ?? and they’re almost normalised, what does that mean, freee to going back to doing what they do best!!!!
bald fat criminal..max kaiser clocked your card
Do you know what you remind me of Noonan?
Max keiser talks about Noonan! BRILLIANT
Never mind the burgers, Irish banks need to be recalled.
noonan ends the gurantee shock! to late tho the damage has been done already! http://www.youtube.com/watch?v=PSY7raADpMU
Clawback of the Bank Bailout is next by a levy on the EU Banking system.
https://www.change.org/petitions/referendum-on-clawback-of-the-irish-bank-bailout
I wonder if the constitutional provision implementing the fiscal compact will prevent such a scheme in future inasmuch as the notional debt would if realised breach the percentage of GDP limit. Anyone know?
The head though.. See what I mean about the manpon..?
Please God, this is the ending of the biggest transfer of money from the less well off in society to the richest in society that was ever make in history! And the best part, it was done with the former not putting up much of a fight.
I would say that Minister Noonan will step down as minister tomorrow!
Its a bit like the debt swap in fact its the same as the debt swap as far as eu is concerned. ie IBRC to be capitalised in exchnge for the 67 billion loan. It in liquidation. s much for that. Now the guarantee scheme being ditched by they way govt got one billion form banks – all the monye they neeed for mobility allowanc e also being scrapped. and as far as EU is concerend we still guarantee banks . and we ow 52 billib allready.
have your say