In regard to the first matter raised by Deputy Gilmore, the position as of 30 September was that a continuation of the situation was not tenable. The continuation of capital outflows at the rate experienced over previous days and weeks meant the stability of the banking system was at risk.
In regard to the question of recapitalisation, I made the point that we are trying to ensure a strong banking sector that can serve the Irish economy in the future. There are constraints on credit markets in every country. It is a problem that banks and businesses are facing everywhere as a result of the global issues we have discussed in this House on many occasions. We need to arrive at a situation on the basis of the State guarantee scheme, which has provided the basis for liquidity in the banking system. The requirement under the scheme to submit business plans is the best mechanism for ensuring transparently that banks are providing lines of credit to Irish businesses. I think the Deputy will agree recapitalisation on its own does not provide that guarantee. Of course, in terms of the expectations of international markets, the improvement of the capital position in banks improves the market's view of those institutions and, by having increased capital, one is in a position to play that off against the possible impairment of assets so that capital adequacy ratios remain sufficient in the regulatory regime that applies.
As I have said from the beginning, the Government is looking at all options in these matters. We have to ensure we minimise to the greatest extent possible the exposure for the Irish taxpayer, which is what we did with the State guarantee scheme. That is an important consideration, particularly given the overall financial and budgetary situation that confronts us.
In regard to the EIB, I encourage the banks to take up that facility to the greatest extent possible. It has to be operated through the commercial bank system and I understand the EIB has entered discussions with banks regarding participation in the facility. These discussions are ongoing and we hope they are successful and that the facility will be taken up by the banks. Financial institutions should use the facility with a view to making the additional funding available to small and medium sized enterprises as soon as possible.
In regard to the final part of Deputy Gilmore's question, we will continue to work with business interests and the banking sector to find out how we can ensure the maximum levels of credit possible are made available to Irish businesses in the present circumstances.