Politics

Merkel remains hopeful on banking union talks

German chancellor expresses respect and admiration to the Irish for leaving troika programme

Taoiseach Enda Kenny greets chancellor Angela Merkel at today’s press conference in Goverment Buildings. Photo: David Sleator/The Irish Times
Taoiseach Enda Kenny greets chancellor Angela Merkel at today’s press conference in Goverment Buildings. Photo: David Sleator/The Irish Times
Fri Mar 07 2014 - 17:46

German chancellor Angela Merkel has said she remains hopeful of a positive outcome in talks on Europe’s banking union, an initiative which holds out the prospect of direct European aid to Ireland to ease the burden of the bank bailout.

Asked this evening in Dublin whether she believed Ireland had a legitimate claim for compensation for legacy or historic banking debts, she framed her answer in the context of prolonged banking union talks.

While Dr Merkel’s government has opposed the provision of direct bank aid to Ireland, she did not rule anything in or out in her remarks.

“We have achieved much but we’re not at the end of the road yet,” she told reporters.

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Speaking alongside Taoiseach Enda Kenny after talks in Government Buildings, Dr Merkel said she wished to pay her respect and admiration to the Irish people for their achievement in leaving the troika programme.

“For me as I just said, what’s most important is that the Irish programme first and foremost can be seen as completed and that is tremendous success story that you were able to emerge from this bailout programme,” she said.

“We’ve all I think learned our lessons of the past and part and parcel of that is that we need to work together very closely on financial issues for example as regards banking union, there are still talks outstanding on the innovative details of that.

“We shall have a single supervisory mechanism, we shall also conclude discussions a single recovery mechanism and the necessary rules for recapitalisation.

“All of that is currently in the consultation process and I must say that I can only say that I have a positive outlook on the possible outcome.”

For his part, Mr Kenny said that nothing could be done about Ireland’s claim retrospective compensation for rescuing the bank until a pan-European bank supervisor is set up at the end of this year.

“Nothing can be done about it until the single supervisory mechanism is put in place and at that time from case to case as was agreed in 2012,” Mr Kenny said.

“Nothing can be done about it until the end of the year. The chancellor is hopeful that there will be a good result.”