Merkel/Kenny joint statement on banking debt

[odlum833]

This is more like it...they have just issued a statement after a weekend of confusion and real anger.

‘Ireland is a special case’: Kenny and Merkel commit to improving bailout

Enda Kenny and Angela Merkel issue a joint statement describing Ireland as “a special case” financially.

22 minutes ago


TAOISEACH ENDA KENNY and the German chancellor Angela Merkel have issued a joint statement affirming that Europe remains committed to splitting Ireland’s banking and sovereign debts.

The statement comes after the two leaders spoke by telephone this afternoon.

Their joint communiqué says the pair had “discussed the unique circumstances behind Ireland’s banking and sovereign debt crisis” and the deal reached by EU leaders four months ago, where they agreed to end the ‘vicious circle’ of banking and sovereign debts.

The two “reaffirmed” that deal, where heads of state told the 17 Eurozone finance ministers “to examine the situation of the Irish financial sector with a view to further improving the sustainability of the well performing adjustment programme”.

The statement said Ireland was recognised as “a special case”, given the circumstances under which Ireland was frozen out of the bond markets, and said the finance ministers would take this into account when examining how to improve the terms of Ireland’s bailout deal.

The communiqué comes after Merkel appeared to throw a spanner in the works of attempts to improve Ireland’s financial situation, and help it to return to international money markets, when insisting that the Eurozone’s new permanent bailout fund could not recapitalise banks retrospectively.

Though Merkel had been asked about how the issue would concern Spain, the move was seen as a blow to Ireland – though the door remained open for the bailout fund, the ESM, to perhaps acquire some of the Irish state’s shareholding in the banks it has paid €64.1 billion to save.

The acknowledgement from Merkel that Ireland is a ‘special case’, however, will encourage the government in its bid to improve the state of Ireland’s financial outlook – particularly as the statement refers to the “unique circumstances” behind Ireland’s debt crisis, in which state aid for struggling banks had played a major part.


Kenny and Merkel: the statement in full

The Taoiseach Enda Kenny and Chancellor Angela Merkel spoke together this afternoon.

They discussed the unique circumstances behind Ireland’s banking and sovereign debt crisis, and Ireland’s plans for a full return to the markets.

In this regard they reaffirmed the commitment from June 29th to task the Eurogroup to examine the situation of the Irish financial sector with a view to further improving the sustainability of the well performing adjustment programme.

They recognise in this context, that Ireland is a special case, and that the Eurogroup will take that into account.

http://www.thejournal.ie/enda-kenny-...44593-Oct2012/

You can't get it any clearer than that. Maybe the anti Merkel protagonists will give it a rest now. This is a very good statement and will hopefully reassure the market tomorrow.

[oon27]

Hopefully this will mean a solid commitment to a bank deal and not just more window dressing.

[odlum833]

Hopefully. I think the reference to Ireland being unique is hugely significant.

Germany backs "special" Ireland on bank deal



DUBLIN | Sun Oct 21, 2012 5:49pm EDT
(Reuters) - German Chancellor Angela Merkel and Irish Prime Minister Enda Kenny issued a joint statement on Sunday reaffirming that euro zone leaders would examine ways of improving Ireland's bank rescue, recognizing that it is a "special case".

Kenny has come under intense pressure at home since Merkel said on Friday that euro zone banks could not be retrospectively recapitalized via the bloc's bailout fund, appearing to dash Irish hopes of getting a wide deal on its banking debt.

Ireland, which has been in talks for almost 18 months to ease the burden placed on it by its failed banks, added a second wave to its negotiations in June when EU leaders cleared the way for rescue funds to be pumped into viable banks, something Dublin said could be back-dated for its already recapitalized lenders.

In a joint communiqué released by the Irish government after Kenny and Merkel discussed the "unique" circumstances behind Ireland's financial crisis, the pair reiterated the pledge made in June that singled out Ireland for assistance.

"Enda Kenny and Chancellor Angela Merkel spoke together this afternoon. They discussed the unique circumstances behind Ireland's banking and sovereign debt crisis, and Ireland's plans for a full return to the markets," the statement said.

"In this regard they reaffirmed the commitment from June 29 to task the Eurogroup to examine the situation of the Irish financial sector with a view to further improving the sustainability of the well performing adjustment program."

"They recognize in this context, that Ireland is a special case, and that the Eurogroup will take that into account."

The statement made no mention of how European banks should be recapitalized but the reference to Ireland as unique will be a boost for Kenny who met heavy criticism in local newspapers on Sunday following Merkel's comments after Friday's EU summit.

The commitment made in June to look at easing the terms of Ireland's bank bailout has helped push Irish bond yields down significantly, allowing Dublin to borrow on long-term debt markets for the first time since signing an EU/IMF bailout in November 2010.

Kenny will travel to Paris on Monday for his first bilateral meeting with French President Francois Hollande since he came to power last May.

Reuters

http://www.reuters.com/article/2012/...89K0HW20121021

Positive headlines for the morning.

[odlum833]

Hollande goes even further than Merkel calling openly for direct retroactive bank recapitalisation

France backs retroactive Irish bank support-Hollande

Update 1


Oct 22 (Reuters) - France backs a retroactive recapitalisation of Ireland's banks, President Francois Hollande said after talks with Irish Prime Minister Enda Kenny on Monday, adding that its banking sector should be treated as "a special case".

German Chancellor Angela Merkel has said euro zone rescue funds cannot recapitalise any bank until a euro zone banking supervisor is fully operational late next year.

However, she and Kenny issued a joint statement on Sunday affirming that Ireland's bank rescue was a "special case" and that euro zone leaders would examine ways of improving it.

"The Irish specificity is that for several months there had already been a recapitalisation of banks via the budget which worsened Ireland's debt and forced it to impose a tough plan." Hollande said after talks with Kenny.

"I said Ireland was a special case and should be treated as such," Hollande told reporters after the meeting.

When asked if recapitalisation could be back-dated Hollande said: "Yes, recapitalisation already took place through their own funds so the Euro Group will take that into account."

The Euro Group is the body regrouping the 17 nations of the euro single currency zone.

http://www.reuters.com/article/2012/...8LMGWV20121022

[thebig C]

Hopefully....this is a sign of good news on the horizon!