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Draghi reminds Ireland of huge support

Monday, February 04 07:39:14

The president of the European Central Bank Mario Draghi has written a reply to Fianna Fail finance spokesman Michael McGrath telling him that the ECB has given extraordinary support to the Irish banks over recent years. The letter comes ahead of a meeting of the governing council of the ECB as Ireland steps up efforts to secure a deal on the promissory note used to finance the former Anglo Irish Bank. Last month Fianna Fail's Michael McGrath wrote to Mario Draghi to say that continuing to meet the repayments under the promissory note made no logical sense.

Mr Draghi's reply gave little away it did refer to obstacles which the Government faces in its talks with the ECB. He said in their current form the promissory note was non-marketable, which means the ECB can not cash them in. It is understood that is something the ECB would like to change if there is a new deal.

Mr Draghi said he was in close contact with the Central Bank and would continue to discuss what was achievable within the confines of the treaties governing monetary union. This is viewed as a reference to the restriction that the ECB can not finance Governments. But Mr Draghi said the support already given to Irish banks in form of monetary policy and emergency liquidity loans has been extraordinary.