Sunday 22 April 2018

Banking Inquiry: ECB's Constancio nominated to represent bank

Vitor Constancio
Vitor Constancio
Donal O'Donovan

Donal O'Donovan

The longest-serving member of the board of the European Central Bank (ECB) has been nominated to begin "informal" talks with members of the Banking Inquiry here.

It follows high-level pressure from the Government, the inquiry members themselves and Irish members of the European Parliament.

The ECB was a key player in the events leading up to the Irish banking crash, and was centrally involved in controversies, including the decision not to "burn bondholders", at certain times, and negotiations that led to the 2010 EU/IMF bailout.

Before now, the ECB has resisted calls for its officials - and former officials - to appear in front of the inquiry as formal witnesses, despite the key role played by Frankfurt in the banking crisis and subsequent Government bailout.

The Frankfurt-based bank claims that, as a European institution, it is answerable to the public only through the European Parliament.

But the current ECB vice- president Vitor Constancio, who was the head of the Portuguese Central Bank until 2010, has now been nominated to represent the bank in "informal discussions" with the Oireachtas Committee conducting the Banking Inquiry.

He sat on the board of the ECB throughout the bank crisis and subsequent Irish bailout.

Efforts are separately under way to convince the former ECB president Jean-Claude Trichet to also provide evidence to the Banking Inquiry.

In January, the ECB told Taoiseach Enda Kenny that Mr Trichet would take part in the Irish bank probe - but that he is legally inhibited from physically appearing at the hearings.

The ECB has proposed that Mr Trichet could answer questions tabled by Irish MEPs in Brussels or could be invited by an "appropriate Irish institution or third party in Dublin".

That was seen as "complete movement" away from the ECB's earlier position as recently as December 2014, according to Banking Inquiry chairman Ciaran Lynch.


Mr Kenny raised the issue of the ECB appearing in front of the inquiry during a meeting with Mr Trichet and the current ECB President Mario Draghi in Brussels late last year.

Mr Draghi wrote to Irish MEP Marian Harkin yesterday to informed them that Mr Constancio will represent the bank in informal discussions with the Oireachtas Committee conducting the inquiry.

Professor Gregory Connor of NUI Maynooth and Professor Eamonn Walsh of UCD are giving evidence at the inquiry today.

Irish Independent

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