Will Ireland Get Access to the ESM Retrospectively – Which Countries Will Support Us?

Abstract

Despite verbal assurarces that Europe was committed to separating Ireland's banking and sovereign debt, Ireland is now very much isolated in its stance to get bank recapitalisation via the ESM retrospectively. The debate over whether Ireland was forced to bail in the senior bondholders is discussed in this paper. The likelihood of support from Eurozone countries is also discussed and the conclusion is that almost 60% support is likely. Ireland may be able to argue that it is a special case as it could not apply the 8% loss to bondholders in 2010, because it was not permitted to do so.