On 30 September 2008, the Irish Government announced it would guarantee all deposits and borrowings for Irish banks.
Aengus Mac Grianna reports for RTÉ Radio News on the night of 30 September 2008. The Minister for Finance Brian Lenihan explains that he is introducing the bank guarantee
to reinforce the strength of the Irish economy... and ... protect the long-term interests of the taxpayer.
Fine Gael spokesman Richard Bruton believes "this is the right thing to do".
There was an international credit crunch in the banking sector at the time, exacerbated by the collapse of US investment bank Lehman Brothers earlier that month. The guarantee was intended to increase liquidity and ensure the banks remained solvent. But the banks' liabilities and exposure to bad loans were far more extensive than the government realised, and Ireland was plunged into debt, leading to an EU-IMF bailout programme of €85 billion in 2010.