EU Commission Vice-President Olli Rehn speaks of shock on hearing the gravity of Ireland's bank debt three years ago

Friday 13 December 2013 07.49
Olli Rehn said that Ireland is not completely out of the woods yet, but he said it is still on a very good and sustainable path
Olli Rehn said that Ireland is not completely out of the woods yet, but he said it is still on a very good and sustainable path

EU Commission Vice-President Olli Rehn has told RTÉ's Prime Time that he was shocked when he heard that the capital hole surrounding the banks was around 60% of the GDP.

He said he remembered the meetings with the late Brian Lenihan in 2010 very well.

Mr Rehn said the financial situation of Ireland is actually quite promising now.

He said that Ireland is not completely out of the woods yet, but he said it is still on a very good and sustainable path. 

Mr Rehn said his main feeling is of relief on behalf of the Irish people and also confidence as regards the future of Ireland and its people.

He said mistakes were made at that time: "In retrospect I think it is quite easy to spot some mistakes like the blanket guarantee for banks."

"But that is now water under the bridge and now we have redirected the river and we are on a better place for the moment." He added.

Mr Rehn would not be drawn on the question of whether Ireland may still get a deal from the ESM on retrospective bank recapitalisation.

"It is an issue that is in the hands of the euro area member states because they are the owners of the ESM which can take decisions on direct recapitalisation or not." Mr Rehn added.

He said he does not expect any nasty surprises from next year's stress tests of the Irish banks:

However, he appeared to be less confident when asked about banks elsewhere in the eurozone.

He said he wants the Legal Services Bill in place sooner rather than later:  

Mr Rehn said: "Overall Ireland has succeeded in the completion of the financial repair which has been crucial for the economic turnaround."

Referring to the legal services reform he said: "It will be good for the Irish people and for the functioning of the Irish society and economy."

Regarding the health budget, he said: "We are assisting the savings in the health sector and it is of course important that the objectives are going to be met in this sector because of its importance, its size and importance for the overall public finances."

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