EN ECB-PUBLIC  
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 29 November 2012 
on the extension of the Irish state guarantee of eligible liabilities of credit institutions 
(CON/2012/98) 
 
Introduction and legal basis 
On 19 November 2012, the European Central Bank (ECB)  received a request from the Irish Minister for 
Finance (hereinafter the ‘Ministe r’) for an opinion on the draft Cr edit Institutions (Eligible Liabilities 
Guarantee) (Amendment) Scheme 2012 (hereinafter th e ‘draft scheme’) amending the Credit Institutions 
(Eligible Liabilities Guarantee) Scheme 2009 (hereinafter the ‘ELG Scheme’). 
The ECB’s competence to deliver an  opinion is based on Articles 127(4) and 282(5) of the Treaty on the 
Functioning of the European Union and the sixth indent  of Article 2(1) of Council Decision 98/415/EC of 
29 June 1998 on the consultation of the European Ce ntral Bank by national authorities regarding draft 
legislative provisions1, as the draft scheme relates to rules applic able to financial institutions insofar as 
they materially influence the stability of financial institutions and markets. In  accordance with the first 
sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council 
has adopted this opinion. 
 1.  Purpose of the revised draft scheme 
1.1 The ELG Scheme came into effect on 9 D ecember 2009. The ECB was consulted on the ELG 
Scheme at the draft stage and adopted its Opinion CON/2009/56
2. Subsequently, the ECB adopted 
Opinions CON/2009/92, CON/2010/71, CON/2010/75 and CON/2011/88 on proposed amendments to the ELG Scheme. 
1.2 The Irish Government now proposes a further prol ongation of the validity of the ELG Scheme by 
12 months, the effect of which will be that elig ible liabilities, as defined in the ELG Scheme, may 
be issued until 31 December 2013. 
 2. The appropriate time to consult the ECB 
The ECB notes that the Minister has requested th e ECB to provide its opinion as soon as possible 
in order to ensure that European Union state aid approval for the draft scheme can be obtained 
quickly and the draft scheme presented for parliame ntary approval. The ECB reiterates its position, 
                                                 
1  OJ L 189, 3.7.1998, p. 42. 
2  All ECB opinions are published on th e ECB’s website at www.ecb.europa.eu. 
ECB-PUBLIC  
2 expressed in previous opinions3, on the importance of a consultation taking place at a point in the 
legislative process which affords the ECB sufficient time to examine the draft legislative provisions 
and to adopt its opinion, and which also enables th e relevant national authorities to take the ECB’s 
opinion into consideration before the provisions  are adopted. Article 3(4) of Decision 98/415/EC 
also obliges Member States to suspend the adoptio n process for draft legislative provisions pending 
receipt of the ECB’s opinion. 
 3. The draft scheme 3.1 The purpose of the draft scheme is the extens ion of the issuance period under the ELG Scheme 
from 31 December 2012 to 31 December 2013. The Mini ster, in his request for an opinion, advises 
that a positive assessment by the ECB on financia l stability grounds of the requirement for a 
prolongation of the guarantee of short term and interbank liabiliti es is considered  essential by the 
European Commission to its approval process as regards such state aid. 
3.2 The ECB reiterates the views expressed in its pr evious opinions on the subject of the ELG Scheme 
and the Irish legislation on financial support to credit institutions
4. In particular, it recalls that 
coordination of the duration of national financia l support schemes across the Union is of crucial 
importance in order to ensure a level playing field5. The ECB also notes that it is the European 
Commission’s practice to approve Member States’ guarantee schemes for no longer than six months in advance
6. 
3.3 Taking into account financial stability consider ations, a further extension of the ELG Scheme 
would be beneficial. Moreover, the ECB understands  that the extension of the ELG Scheme is 
safeguarded by the timely compliance of the Iri sh government with the ongoing European Union-
International Monetary Fund Programme of Financial Support for Ireland. 
 This opinion will be published on the ECB’s website.   Done at Frankfurt am Main, 29 November 2012. 
[signed] 
 
The President of the ECB 
Mario DRAGHI 
                                                 
3  See Opinion CON 2011/88. 
4 See Opinion CON/2011/88. 
5  See Opinion CON/2009/73. 
6  See the DG Competition staff working document of 30 April 2010, ‘The application of State aid rules to government 
guarantee schemes covering bank debt to be issued after 30 June 2011’, available on the European Commission’s website 
at www.ec.europa.eu.