I strongly suspect - though since there has been no comprehensive account of what happened it's very hard to be sure - that the message from Europe was that no EU bank should be allowed fail and burn its creditors. At the time, fear of contagion seems to have ruled EU-level decision making, and the theory seems to  have been that a failure of an Irish bank could cascade through the system.

The choice of the insanely stupid bank guarantee scheme seems to have been largely down to the Irish government and their professional advisors and the banks but the sensible options, such as killing the banks and resurrecting the utility parts were effectively closed off by European requirements.

By "Europe" here, I don't necessarily mean formal action of any of the institutions.