President Mary McAleese has signed legislation giving effect to the Government's €420 billion bank guarantee scheme.
A single-line statement from Áras an Uachtaráin just after 3.30pm said Mrs McAleese had signed the Credit Institutions (Financial Support) Bill 2008 into law.
The bulk of the new law was passed by a huge majority in the Dáil just after 2am with 114 votes for and 18 against after Fine Gael and Sinn Féin supported the legislation. Labour voted against the Bill. Seanad amendments were later approved by the Dáil clearing the way for the new Bill to become law.
Minister for Finance Brian Lenihan tonight defended the Financial Regulator in relation to control of the banking industry and said he had a "set of robust principles" which he implemented.
Mr Lenihan said part of the problem with the banking industry here had been low European Central Bank interest rates in crecent years which had "undoubtedly fuelled" certain lending practices.
Speaking on Today FM radio, the Minister said he believed the resilience of the Irish banking sector had been "quite remarkable" given failures in countries such as Belgium, Germany, Britain and the "whole wave of failures" in the US.
He said banking failure had become part of the world economic picture.
On State involvement in the banking sector, Mr Lenihan said he did not favour taking shares in banks if it could be avoided.
“I don’t believe the State should be taking risks on private enterprise. If there’s a need for rationalisation in the banking industry then lets get on with that," he said.
Defending the decision to introduce the emergency legislation guaranteeing bank deposits, Mr Lenihan said all of the Irish banks had "big problems" in relation to the shortening of time periods on outstanding loans.
The problem had reduced to a very short timescale by Monday evening and it required "urgent attention", he said. It was his as Minister for Finance to take "swift action" when a danger arises and that was what he had done, he said.
This morning Fine Gael deputy leader Richard Bruton signalled that his party had supported the Bill in the national interest and said that the debate on the legislation - which began at 11am yesterday and continued until 7am today - was comprehensive.
Labour Party leader Eamon Gilmore did accept the Government had to act but said that the Bill shed no light on the scope and extent of the guarantee being sought. He said the only thing that was known was that the quantum had grown following the addition of Ulster Bank to the list.
Speaking today during a constituency visit to Cork South West, Mr Gilmore said: “My party did not lightly take the decision to vote against a measure like this, but I am convinced that it was the correct decision.
“The Labour Party stood alone in the Dáil last night in opposing this Bill. Not because we oppose the principle of action being taken, but because we refuse to sign a blank cheque. Somebody had to stand up for the interests of the taxpayer.”
The marathon debate on the Credit Institutions (Financial Support) Bill continued through the night. After the committee stage of the Bill concluded in the Dáil at 2am it was transferred to the Seanad for a further five hours of debate.
The Seanad then passed the legislation by 39 votes to five. The Seanad made two amendments, including the stipulation that approval for the bank-guarantee scheme would come from both houses of the Oireachtas.
With the Government signalling last night that it would accept two Opposition amendments, it was necessary for the Bill to return to both the Dáil and Seanad today to give approval to the amendments. A debate on the amendments was then conducted in the Dáil and the entirety of the legislation was presented to Mrs McAleese at Áras an Uachtaráin to sign this afternoon.
