Irish Finance Minister Michael Noonan said Ireland will not allow its banks to be treated differently from others in Europe, and will resist pressure from Brussels to conduct stress tests earlier than its eurozone peers.
Ireland identified a large capital hole in its banks in 2011 when it conducted its own set of stress tests that were seen as more rigorous than those carried out by the European Banking Authority (EBA), but Dublin now wants to align its next check up with the EBA, even if that pushes them out to next year.
However the European Commission said in its latest review of Ireland's bailout progress last month that a credible stress test for Irish lenders was essential before the bailout ends later this year to ease the uncertainty around asset quality.
The Commission, one of three lenders overseeing Ireland's bailout, stressed that Ireland should run another rigorous set of its own tests rather than wait and do so as part of the EBA's exercise. Noonan indicated he was still resisting that, despite some signals to the contrary from his central bank governor Patrick Honohan. "We want to normalise our system in Ireland. Stress-testing normalisation would be to align it in close proximity with the European stress test system", Noonan told Reuters on the sidelines of a conference in Switzerland.
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