Język Polski
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The liquidation of Ireland’s IBRC and the operational freedom of eurozone member states with respect to monetary policy
Jolanta Zombirt
Abstract
The Emergency Liquidity Assistance (ELA) issue is not well elaborated in economic literature, also in Poland. Still, the possibility for a central bank to grant liquidity assistance for selected banks in a given country in the Eurozone deserves deeper attention, also in the area of a monetary policy framework within the EMU. In this context it seems to be important to analyze the Irish case and the specially created “bad bank” – IBRC. Because paying back the obligations of the IBRC to the Irish central bank became too costly for the Irish budget, financial engineering has been employed. The ELA in Ireland and its examination has led to the conclusion that this
instrument is not safe, especially for further integration of the Eurozone. Notwithstanding, financial engineering turned out to be a very helpful instrument from the point of view of public finances.
Keywords:
monetary policy of the Eurozone, liquidity assistance in emergency situation (ELA), promissory notes, state budget, financial engineeringMost read articles by the same author(s)
- Jolanta Zombirt, Securitization and European standards of liqudity managements in banks , Safe Bank: Vol. 58 No. 1 (2015)
- Jolanta Zombirt, Royal Bank of Scotland – a state assistance case study , Safe Bank: Vol. 54 No. 1 (2014): Bezpieczny Bank
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