Reports are calling the government's effort in assisting Australia's banks during the height of the world financial crunch an after-dinner mint after discovering that Macquarie Group chief executive Nicholas Moore held a private dinner for then financial services minister, Senator Nick Sherry days before the help came in.

Senator Sherry's office admitted he dined at Macquarie's Sydney Martin Place headquarters along with other bank executives on October 7, 2008.
Five days later, the federal government declared a deposit guarantee and wholesale funding agreement that would prop up the nation's banks in the wake of global turmoil sparked by the downfall of Lehman Brothers three weeks earlier.

The move aided in ending the rout in Macquarie's share price that had plunged by half from August amid a crisis of confidence and fears of its liquidity status.

According to reports, between 10 and 14 senior Macquarie executives, including Mr Moore and Macquarie's government lobbyist, Trevor Burns, attended the dinner with Senator Sherry.

Based on the senator's "ministerial event brief", the minister participated "in general discussions around the table on issues in the financial sector, including general market conditions''.

The dinner was organized in July 2008, when credit markets were squeezing after the breakdown of Bear Stearns earlier that year. Its timing provided an excellent opportunity to present the bank's views on the disturbance in global markets directly to the minister.

In response to the current issue, Senator Sherry's spokesman issued a statement saying, ''Economic ministers in all governments meet regularly and routinely with financial sector organisations. The dinner in question was nothing more than this kind of regular and routine sector consultation and had been organised 3 months before it took place.''