A lawyer who is a senior member of the Bankrupt Lawyer Group has criticised the Government for its refusal to grant bailouts to Ireland’s banks.
The lawyer, who has represented the Bank of Ireland, has said that if Ireland’s bailouts go ahead, the Government will have to declare bankruptcy.
Mr Higgins said that despite the Government’s claim that it will not grant bailout to Irish banks, the Bankers’ Association of Ireland said it will “work with the Government to ensure that Irish banks are not forced to close.”
“If we cannot meet the terms of our agreement with the banks, we will seek to negotiate our own bailouts,” he said.
“The Government should not be allowing banks to close, but rather offering them an exit strategy and allowing them to exit without any losses.”
In the first phase of the recapitalisation of the banks after the bank recapitalisations, the Irish Government agreed to pay out around €4bn in loans to recapitalise the banks in 2019.
The Government is also planning to sell its stake in Anglo Irish Bank to a private investor for €1.7bn.
Mr Ireland has said the Government intends to keep the Government in the loop on any new loans that might come through.
However, he has also suggested that there will be some sort of bailout to cover losses from the restructuring.
“If there are no further payments for recapitalising banks, I believe there will have been an appropriate recapitalization of Irish banks in which the taxpayer will be held responsible,” he told RTÉ’s Today with Sean O’Rourke on Friday.
Mr O’Reilly said the Taoiseach and Finance Minister were “unlikely to be able to do it with the money they have available”.
He added that the Government “should have a contingency plan to deal with the loss of money if it’s necessary”.
“We need to have a plan in place that would enable the Government and the Government alone to do this,” he added.
“In a situation where there’s a bailout, we need to be sure that we’re not taking the taxpayer out of it.”
Mr Higgins added that if Irish banks were to go bankrupt, they would have to be liquidated and the taxpayer would be responsible.
“When you have a bank go bankrupt you’ve got to liquidate it and then you’ve had to find a way to pay off the creditors,” he explained.
“So you have to find that money, and that’s what we’re going to be looking at.”
There’s going to have to happen some sort, and it’s not just going to happen overnight.
It’s going for a long period of time.
“Mr O.R. said that the taxpayer should not have to bail out the banks.”
A bank is not just a legal entity that can be liquidating, it has to be made liquid,” he insisted.”
It can’t just be made in liquidation.
That’s not the case.
“Mr Ireland told RTE that the banks should be taken over and the government should be given responsibility.”
I think it’s very important for the taxpayer to have control of Irish banking,” he stated.”
That’s what it’s all about, and if it takes control of the Irish banks it will take control of every Irish bank, and we will have that control.
“We’ll have a Government that’s going, and they will be responsible for all that.”
The Government is seeking €500bn in bailouts from the European Union and IMF, as well as another €50bn from the Bank.