Words, like body language, can be subtle.
But Jean-Claude Trichet has made very clear his opposition to haircuts for secured and unsecured bank creditors. In response to Fine Gael's plan to unilaterally restructure Ireland's debt, Trichet insisted today that the bailout plans for Ireland's banks have already been decided and that "the plans have to be executed."
Look forward to a bank bailout and bondholder showdown in the coming weeks.
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Trichet Reiterates Opposition to Irish Debt Restructuring
EUROPEAN CENTRAL Bank (ECB) chief Jean-Claude Trichet has reiterated his opposition to any debt restructuring by Ireland, saying the terms of the EU-IMF bailout plan for the State have been approved by “the entire world.”
As top ECB officials closely observe the Irish election campaign, this was the second time in five days that Mr Trichet made the case against any restructuring of Ireland’s debt. He relayed the same message last Thursday immediately after the monthly meeting of the bank’s governing council.
In Brussels yesterday, Mr Trichet said the Irish rescue plan and that of Greece did “not comprehend” the notion of bondholders being compelled to take a “haircut” on their investments. Ireland entered an €85 billion EU-IMF programme last November and Greece was bailed out to the tune of €110 billion last May.
- “We have plans. The plans have to be executed, have to be implemented in the best fashion possible as has been the case the world over and it is very, very important in my opinion not to confuse things,” he said.
- “We have a programme, approved by the international community, approved by the IMF board, the entire world, approved by the European [Union], approved and financed by the IMF and the European [Union].
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