Friday 18 October 2019

Banking Inquiry: McGrath calls on Trichet to respond to 'a bomb would go off' comment claims

Jean-Claude Trichet
Jean-Claude Trichet

Daniel McConnell Group Political Correspondent

A leading member of the €5m Oireachtas Banking Inquiry has called on former ECB President Jean Claude Trichet to respond to claims he said a “bomb would go off” if Ireland burned senior bondholders in 2011.

Fianna Fáil Deputy Michael McGrath has demanded that Mr Trichet respond to evidence given to the Inquiry on Thursday by Finance Minister Michael Noonan about a telephone conversation between the two men on 31 March 2011.

"Minister Michael Noonan told the Banking Inquiry this week that, in a telephone conversation with Jean Claude Trichet on 31 March 2011, Mr Trichet told him that 'a bomb would go off in Dublin' if the government proceeded to pledge to burn senior bondholders in their Banking Statement due in the Dáil that afternoon,” he said.

 Mr McGrath said that in his engagement with the Inquiry in 30 April last, Mr Trichet, under questioning, denied that the government had been threatened, and said the ECB 'simply gave advice to the government' on burning senior bondholders.

“On the specific comment that 'a bomb will go off in Dublin', he made what appears to be a contradictory statement,” Mr McGrath said.

At the Inquiry, Mr Noonan admitted ditching plans to burn investors in a rogue bank after a last-minute call from the ECB warning him a bomb would go off in Dublin. Mr Noonan took a last minute call from Jean-Claude Trichet, then ECB president, which forced him into a U-turn moments before his announcement. "He (Mr Trichet) said if you do that a bomb will go off, and it won't be here, it will be in Dublin," Mr Noonan told a parliamentary inquiry in to the banking crisis in Dublin. But Mr Noonan, for the first time confirming the starkly-worded warning, said he had no doubt about what was said. "I can assure this committee that he said it. He did not use the word economic," he said.

Michael McGrath
Michael McGrath

"He said a bomb will go off, a bomb will go off, he did not qualify it."

Mr McGrath said that the inquiry is now planning to write to witnesses to respond to apparent contradictions arising from recent evidence given at the Inquiry and to give witnesses the opportunity to clarify the evidence they gave. “I have therefore requested that the Inquiry formally write to Mr Trichet to ask him to address the apparent contradictions between his evidence and that of Minister Noonan, and to clarify any matters arising from Minister Noonan's evidence. Given the key role of the ECB on the question of burden sharing during Ireland's banking crisis, it is essential that these matters are fully clarified in order that the final report of the Inquiry can be as accurate and comprehensive as possible,” he said.

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