I propose to take Questions Nos. 219 to 222, inclusive, together.
As Minister for Finance, I do not have a role in the credit assessment, risk assessment or debt resolution processes of any bank, even one in which the State has a shareholding. Decisions in this regard are the sole responsibility of the board and management of the banks, which must be run on an independent and commercial basis. The independence of banks in which the State has a shareholding is protected by Relationship Frameworks, which are legally binding documents that cannot be changed unilaterally. These frameworks, which are publicly available, were insisted upon by the European Commission to protect competition in the Irish market.
Neither I nor officials in my Department receive information in relation to the debt write-downs granted by the banks in which the State has/had a shareholding in, these are commercial decisions which would have been made by the banks on a case-by-case basis having reviewed the information available to them at the time of the decision.
Appointments to the boards of the banks in which the State has a shareholding are made on foot of the Minister’s rights as shareholder in each of the banks and not using the powers contained in the Credit Institutions Financial Support (CIFS) Act as was the case with Public Interest Directors. Pursuant to these rights the Minister can nominate up to two directors to be appointed to the boards of both AIB and PTSB. While these bank directors are nominated by the Minister for Finance, they must carry out their functions on an independent basis. While a nominated bank director’s primary duty is to the bank itself, there is periodic communication with the Department of Finance and/or the Minister on any important matters of interest or concerns relating to the Minister as shareholder from a board level. Typically, any decisions around customer debt write-downs would not be a matter for the board of a bank.