Senior Coalition ministers discussed increasing security at banks and ATMs when the euro crisis was at its worst, Minister for Finance Michael Noonan has said. Mr Noonan's comments came after Taoiseach Enda Kenny was criticised by the Opposition for saying earlier this week that Central Bank Governor Patrick Honohan told him to prepare to deploy the Army.

“The Governor of the Central Bank said to me: ‘It looks like this weekend . . . you’ll have to put [the] Army around the banks and around the ATM machines and introduce capital controls like they had in Cyprus’,” Mr Kenny told a Madrid conference of the European People’s Party (EPP), the centre-right political grouping to which Fine Gael belongs.

Fianna Fáil leader Micheál Martin called Mr Kenny’s account a “fairy tale” and said the Taoiseach owed people a “full explanation and cannot hide behind confidentiality”.

Mr Kenny’s spokesman said a conversation took place with Prof Honohan “around the grave situation our banks were in and the necessity to make security plans”, as had been described by the Taoiseach.

The spokesman also claimed Fianna Fáil has “zero credibility commenting on the financial state of the country when they left office”. Sources also said that Mr Kenny used his folksy manner of speaking to describe the situation.

Asked yesterday about Mr Kenny's comments, Mr Noonan said that while he was not party to conversations between Mr Kenny and Prof Honohan, contingency plans were drawn up by the Economic Management Council (EMC). The EMC comprises the Taoiseach, Tánaiste, Minister for Finance and Minister for Public Expenditure and Reform.

"There were stories around of a possible default in Ireland at that stage and we were looking at the consequences of that and certainly the issue of security came up," Mr Noonan said. He added the discussions took place in 2012 and were in preparation for capital controls, such as were implemented in Greece earlier this year.

“So if something similar happened in Ireland and if ATM machines actually ran out of money, there was quite clearly security considerations and there were discussions about what might be done but then, in the nature of things, things passed on and the discussions were never turned into an actual security plan.”

Minister for Public Expenditure Brendan Howlin also previously said the EMC discussed increased security measures at the banks, as well as the reintroduction of the pound, in the event of a euro collapse.