As I stated in my pre-Budget letter, the potential adverse impact on the Irish economy and Irish financial conditions if any of those scenarios were realised calls for the accumulation of financial and fiscal buffers that would help to limit the damage.
In relation to financial sector buffers, in line with our mandate, the Central Bank is working to ensure that the capital positions of banks are sufficiently strong to withstand the losses that could be triggered by a negative shock. In particular, we recently activated the counter-cyclical capital buffer, which will require banks to maintain an extra buffer in relation to Irish exposures.