Saturday 18 November 2017

May 3

The NTMA first floats the idea of cancelling its monthly bond auction due to the market turmoil sparked by the Greek crisis.

The crisis pushed rates up to 5.15pc. The agency decides to continue with monthly auctions but the cost of borrowing soars; forcing the agency to announce in late September that it is cancelling the remaining auctions until the new year.

By late November, the country throws in the towel and borrows from the IMF and European Commission. The decision means the country won't have to return to the bond markets for another two years.

June 10

Publication of two important reports into the origins of the banking crisis.

While blaming the Financial Regulator for being timid, the reports give almost no names and are ambiguous enough to allow both the Government and the opposition to claim support for their views on whether Anglo should have been saved and the banks' subordinated debt guaranteed.

July 19

Moody's cuts Ireland's credit rating by one notch to Aa2, saying the country faces a slow climb out of recession as the cost of the rescue of its banking sector mounts.

A month later, Standard and Poor's follows suit, giving the country's rating a negative outlook.

The logic of the move is criticised by the National Treasury Management Agency in an unusual outburst.

By the end of the year, Ireland is unable to borrow at all and Fitch has slashed its rating for Ireland to the same level as Libya and just three notches above junk.

July 23

Allied Irish Banks passes the EU's stress tests for banks but is one of 12 lenders across Europe to only scrape through.

Three months later, it becomes clear that the bank needs billions of euro to stay afloat and should never have been allowed to pass the test.

This calls the tests into question and leads to doubt about the health of other European banks which also passed.

August 24

CRH, the biggest Irish-based company on the stock exchange, stuns the markets by issuing a profit warning.

The company, which has picked up numerous awards for investor relations, suffers the biggest one-day drop in its share price since 1988, following the warning.

Six weeks earlier, it had assured shareholders that all was well at the building materials company.

Months later, it is still battling to restore confidence in the company with a series of investor meetings that have helped the share price to regain some ground.

September 28

The Government asks Central Bank governor Patrick Honohan to put a price on the bank bailout after the markets continue to question official estimates. Honohan says the bailout of Anglo may cost as much as €35bn, while the bailout for the entire sector could be as high as €50bn.

While the markets had known this for some time, the price tag causes widespread consternation among the public with consumer confidence posting the biggest monthly decline in more than four years.

By December, Anglo chairman Alan Dukes is warning that the €35bn figure may not be enough.

October 21

The Government-funded Economic and Social Research Institute (ESRI) takes the highly unusual step of warning that government policy risks pushing the economy into a "prolonged recession".

The €15bn cuts needed to reduce the deficit may push the economy "close to a tipping point", ESRI economist Ide Kearney cautions.

The ESRI calls for the savings programme to be extended by two years. A month later, it is extended by a year.

"Not many people in the world believe we are going to make 3pc of GDP by 2014," says ESRI economist Alan Barrett. "We think you may gain in credibility by having a programme out there that people believe you are going to have a chance of meeting."

November 12

Reuters and Bloomberg report that Ireland is in talks with the IMF about a bailout. Taoiseach Brian Cowen denies the reports and a game of verbal cat and mouse follows, until Central Bank governor Patrick Honohan goes on 'Morning Ireland' to tell the country that the reports are true and the bailout will probably be very large.

An agreement that sees Ireland stump up €17.5bn and the IMF and Europe stump up €67.5bn is agreed within weeks.

November 24

The Government publishes a four-year plan for the economy that includes many IMF demands and calls for some of the toughest cuts ever seen in an Irish Budget.

The plan, which has been agreed with the country's new creditors, ties the hands of the incoming government to an extent never previously seen in Irish politics and underlines just how much power has been temporarily ceded to outside institutions.

December 8

Michael Noonan, the Fine Gael finance spokesman, recalled from retirement following Richard Bruton's botched leadership bid, throws down the gauntlet to Finance Minister Brian Lenihan in an energetic and colourful reply to the minister's lacklustre and much-leaked Budget speech.

The speech is widely seen as cementing Noonan's claims to be the country's next finance minister after the general election due sometime in 2011.

Irish Independent

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