The ECB blackmailed the Irish Government to bail out the banks who had made loans to the developers using funds originating from EU banks - by threatening to withdraw all liquidity support for the Irish banks and thus crashing the Irish banking system - if it did not do so.  Even now it is threatening to withdraw support if the Irish Government does not pay unguaranteed senior bondholders in the long defunct Anglo-Irish bank in full c. 3.8 Billion in the next few months - see Colman quotes.

Index of Frank's Diaries