Dáil Éireann Debate, Tuesday - 26 March 2013
221. Deputy Pearse Doherty asked the Minister for Finance if he will outline the capital control measures he has available to him to prevent bank runs on Irish banks; and if he will make a statement on the matter. [15182/13]
View answerFirstly, I would like to point out that since the Irish covered banks were recapitalised in July 2011 they’ve experienced deposit inflows of c.€14.8 billion. Deposits have increased by €7.7bn year on year to the end of February 2013. It is also important to note that the covered banks have raised significant funding on international capital markets, both through public covered bond issues and private funding transactions, of over €3.5 billion. In addition, new investors have purchased the €1 billion Bank of Ireland contingent capital bond from the State and that bank has also raised an additional €250 million in lower tier 2 debt.
These capital and deposit inflows are significant.
In relation to the Deputy’s specific question, the Minister of Finance and the Governor of the Central Bank of Ireland have a range of powers to prevent capital outflows before consideration of capital controls. In relation to capital controls, such measures would have an adverse impact on the Irish economy, which is a small, open, economy dependent on its vibrant export orientated sectors. Our export industries need secure and efficient payment mechanisms which ensure the free movement of capital. Our strategy of pursuing strong and sustainable export led growth has been fully endorsed by each of the members of the Troika.
