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No plans to release ECB letters despite newspaper report

The Irish Times publishes details of letters the ECB sent to Brian Lenihan in the lead-up to Ireland seeking a bailout two years ago leading to more calls for the letters to published in full.

File photo
File photo
Image: Press Association Images

THE DEPARTMENT OF Finance has said there are no plans to release the letters that European Central Bank sent to former finance minister Brian Lenihan in the build-up to Ireland applying for a bailout in 2010.

It follows publication of a story in the Irish Times today in which political correspondent Stephen Collins indicates that the paper has seen the letters that were sent by the then president of the ECB, Jean-Claude Trichet, to the late Lenihan.

The letters have been the subject of much talk in the past week after the Finance Minister Michael Noonan told the Sunday Independent that a letter sent by Trichet in November 2010 should be released.

Noonan said last Sunday that the “very direct” letter left Lenihan with “little or no option” but to begin negotiations on a bailout in November 2010 but said that it was not within his authority to order their release.

He said that the matter was one for the Freedom of Information unit which has so far declined to release the letter to TheJournal.ie and numerous other media organisations.

Fianna Fáil, the party in government at the time of the bailout, has reiterated its call for details of correspondence between the Department of Finance and the ECB in the lead up to the bailout to be released to the public.

Letters

Today, the Irish Times says it has seen the letters but it has not published them nor has it directly quoted from them but it does paraphrase their content in detail.

The paper says that three letters from Trichet to Lenihan – sent in October and November of 2010 – outlined the ECB’s concerns about the state of the Irish banks and the strain that keeping them sufficiently capitalised was putting on the entire European banking system.

The story also makes reference to a telephone conversation between the two men on 12 November which it says was “decisive” at a point where the ECB was underwriting more than €150 billion of funding for the Irish banks.

The correspondence would eventually lead to Ireland applying for a bailout from the EU and IMF on 20 November 2010 with Lenihan later telling BBC Radio 4 that a letter from Trichet ‘bounced’ Ireland into its bailout.

A spokesman for the Department of Finance said today that the Department did not release the documents to the paper nor was he aware of any leak either from the Department or its Freedom of Information Unit.

The spokesperson said that the documents released to the Irish Times in response to an FOI request were the same that were released to other media organisations including TheJournal.ie.

Last weekend we published the documents that we received from the Department of Finance which included a responding letter to our request, a schedule of the documents that fell under the scope of the request and the reasons why almost all of the letters from the ECB would not be released.

‘Very disturbing’

The FOI unit outlined that the letters which would not be released contained ‘information communicated in confidence from, to or within an international organisation of states’  and if released ‘could have a serious adverse effect on the financial interests of the State, or on the ability of the Government to manage the national economy’.

Meanwhile, the Fianna Fáil finance spokesman Michael McGrath has called on the government to publish a full record of contact between the Department and the ECB in the lead up to the bailout being sought.

He described the details of today’s story in the Irish Times as “very disturbing” and said that the Irish people deserved to have access to the records.

McGrath said in a statement: “The information that has come into the public domain paints a picture of relentless pressure from the ECB on the Government to accede to its demand for Ireland to enter a formal programme in the false belief that it would prevent contagion throughout the rest of Europe.

“Subsequently the ECB insisted during the bailout negotiations, to the cost of ordinary Irish citizens, that no losses whatsoever could be imposed on senior bondholders in Irish banks.

“The Irish people deserve to have access to all records of the period leading up to and during the negotiations of our formal programme with the EU / ECB / IMF. It is not good enough for information as important as this to be drip fed into the public arena by way of selective leaks.

“I repeat my call on the Government today to release the records of all contact with the ECB before and during thebailout negotiations. It is my view that these records will allow a greater understanding of the circumstances of Ireland’s entry into a programme and the pernicious role of the ECB in insisting that Irish citizens bear the full cost of a banking bailout.”

Read more: We asked for copies of the ECB’s letters to Brian Lenihan. Here’s what happened

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About the author:

Hugh O'Connell

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