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International private equity funds must not be allowed to take over the Irish banking sector

28 November, 2008


Sinn Féin Economic spokesperson Arthur Morgan TD today said "allowing international private equity funds to take over the Irish banking sector would have disastrous consequences for the economy in the future. Their sole interest is to get as much profit as possible in as short a period a time as possible. When it suits them they will sell up and move on, regardless of the implications for the economy."

Deputy Morgan said, "Today's discussions between Minister for Finance Brian Lenihan and leading figures in the six Irish banks covered by the state guarantee scheme are critical. There are a range of options open to the government in terms of re-capitalising and they need to move on the basis of what is in the long term interests of the Irish economy.

"Sinn Féin believes that allowing international private equity funds to take over the Irish banking sector would have disastrous consequences for the economy in the future. Their sole interest is to get as much profit as possible in as short a period a time as possible. When it suits them they will sell up and move on, regardless of the implications for the economy. The Irish state has not insured our financial sector with the guarantee scheme for the benefit of private equity investors and the government must surely recognise this.

"The best options available at this time are the banks raising additional capital themselves and investment by the state. Any money invested by the state in the banks must be given in return for shares, ie, semi or full nationalisation, and it is essential we know where our money is being spent. Recapitalisation may also be an investment for the state. If the banks become profitable again, the state will have a shareholding in them which can either be kept to pay dividends, or sold back to the market for a windfall return. The government shoul keep one of the banks in state ownership." ENDS

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