Business Irish

Friday 28 October 2016

The Trichet denials - what this is all about

Published 03/05/2015 | 02:30

Jean-Claude Trichet
Jean-Claude Trichet
Ray McSharry
Lehman Brothers
Michael Noonan

The Trichet denials - what this is all about

  • Go To


September 15, 2008

• Lehman Brothers, a giant of US finance, collapses and files for bankruptcy.

September 20, 2008

• Brian Lenihan said Trichet rang him to warn him what to do with the Irish banks.

"Mr [Jean-Claude] Trichet [ECB president] rang me, and hadn't been able to get through to me. I was at a racecourse in Co Kilkenny at a Fianna Fail event on the Saturday. So I caught up with on Mr Trichet's message the following day, which was that 'you must save your banks at all costs'," Mr Lenihan said.

Trichet has denied ever making this call.

"No message to Brian, no message to the government. All central bankers were saying to governments, no repeat of Lehman Brothers," Trichet said.


September 29-30, 2008

• Cowen and Lenihan introduce a blanket bank guarantee of all six banks, including Anglo and Irish Nationwide.

Other banks, AIB and Bank of Ireland, had argued to let Anglo and INBS fail.

November 2010

• Lenihan dejected as Trichet and ECB stop Ireland from burning senior bondholders as part of the Troika bailout.

Lenihan was angered because Trichet had initially expressed a willingness to allow it, but changes his mind at the last minute, former minister Ray MacSharry wrote in a 2014 book on the late minister.

Last week, Trichet rejected claims by MacSharry in the 2014 book that he had initially agreed to allow Ireland burn bondholders but then changed his mind.

"Totally absurd," he told Ciaran Lynch who read from an essay by Mr MacSharry on Mr Lenihan.

Mr MacSharry wrote that Mr Lenihan had rung him, despondent after Mr Trichet had backed off allowing the Irish government burn bondholders in 2010.


March/September 2011

• Trichet again prevents new finance minister Michael Noonan from burning bondholders.

Mr Noonan said that during his meeting with Mr Trichet, he raised the issue of burning senior bondholders at the now-defunct bank, but that Mr Trichet's opposition to any burden-sharing had increased significantly. "He has been dead against it," Mr Noonan said.

Mr Trichet is reported to have told Noonan that if junior bondholders were burned "a bomb will go off. It will not go off in Frankfurt, it will go off in Dublin".

The banker said this was not his style of metaphor and "totally not in line with relationship I had with your government".

Sunday Independent

Read More

Promoted articles

Editors Choice

Also in Business