Taoiseach Micheál Martin has said he misspoke in the Dáil yesterday when he said Irish banks were not bailed out.

In an interview with The Echo, Mr Martin said: "I misspoke yesterday in the Dáil and made a mistake in terms of how I articulated it.

"Essentially I was making the point that the shareholders... themselves weren't bailed out.

"But obviously the banks, there was a huge rescue package for the banks, of course there was we know that, in terms of both protecting depositors and protecting bond holders," he said.

Tánaiste Leo Varadkar, meanwhile, told the Dail today that there was a bailout of Irish banks, and explained that Mr Martin "misspoke" when he contended this had not happened.

Asked about the Taoiseach's comments, the Mr Varadkar said directly: "There was a bailout of the banks 12 years ago."  

The Tánaiste added: "The Taoiseach misspoke yesterday. He did correct himself, what he meant to say was the shareholders were not bailed out."

Mr Martin's remarks triggered a significant response from Opposition parties.

Labour TD Brendan Howlin said the Taoiseach should correct the Dáil record.  

Mr Howlin told RTÉ's Today with Claire Byrne that he thought the comments made were "bizarre" and represented "alternative facts".

"By any plain understanding of English the Irish people bailed out the banks in 2008. The then Minister of Finance, Brian Lenihan, with the agreement of the Government gave an unconditional guarantee to the liabilities of failed banks, without actually knowing at the time the full cost of that."

Mr Howlin said the Irish people deserve to hear the truth about a "painful" chapter in the State's history.

"I think he should (correct the record). Sometimes in the heat of questioning, you say things that you think again about.

"But I think that episode was so painful and has been so painful over the subsequent decades to the Irish people that we have to be very truthful about it."

He said "in any objective economic sense" a bailout took place.

"You can't reinvent history," he said.

"Technically those who actually bought shareholdings in the six covered institutions were burned as well, they lost the shareholding and suffered grievously," he said.

"And so, if you like, if you want to look at that technical issue to the owners of the banks, where they are bailed out?

"No. But were the banks themselves, the institutions bailed out with a wall of money? In any objective economic sense, of course that's exactly what happened," he concluded.