Fine Gael finance expert claims banks will need another €20bn
He was elected as a Fine Gael TD after the party lauded him "as a leading independent expert commentator on the banking crisis".
But Fine Gael wasn't too interested in Peter Mathews' expertise yesterday after the new Dublin South TD said the banks would need another €20bn -- on top of the €24bn being injected by the new Government.
The former ICC Bank official said there was about €90bn to €95bn worth of debt in the banking system, but only €50bn has been recognised already.
He said the further €24bn capitalisation as a result of the stress tests by US investment and consulting firm BlackRock brings it up to €70bn and another €20bn injection would be needed on top of that, because the results did not address Anglo and Irish Nationwide.
Mr Mathews also said the loss-sharing would have to include Bank of Ireland and AIB -- even though the Government said there would be no burning of bondholders in these two banks as they need to attract outside investment.
Responding to Mr Mathews' analysis, a spokesman for Finance Minister Michael Noonan said the capital stress tests by the Central Bank were based on conservative assumptions.
Despite being a Fine Gael TD, Mr Mathews told the Irish Independent he was expressing his opinion in a "professional private" capacity and people misunderstood his views.
"The starting point Mr Noonan announced on Thursday is a good starting point for restructuring the banks," he said. "I am saying my professional expertise indicates it is going to need more."