Richard Bruton
Question:56 Deputy Richard Bruton asked the Minister for Finance his views on the desirable restructuring of the banking sector here. [17128/10]
View answerWednesday, 28 April 2010
Questions (25, 26)
Eamon Gilmore
Question:66 Deputy Eamon Gilmore asked the Minister for Finance the position regarding prospective realignments within the domestic banking sector; the position regarding the future of building societies (details supplied); and if he will make a statement on the matter. [17211/10]
View answerWritten answers
I propose to take Questions Nos. 56 and 66 together.
In the first instance it is a matter for independent financial institutions themselves to consider and determine their strategic arrangements, subject of course to necessary regulatory, competition and other relevant requirements. Regarding the State's role, its primary consideration continues to be to protect, in the public interest, the financial and economic system of the State. Where public support is provided to individual institutions, either in the form of participating in NAMA or by way of the provision of capital, such institutions will be required to prepare and submit restructuring plans to the EU Commission. So far, restructuring plans have been submitted by Anglo Irish Bank, Bank of Ireland and AIB. Following the State's recent capital investment in INBS and the commencement of NAMA, restructuring plans will also have to be submitted in respect of the two building societies in June. In respect of the INBS, as the new special investment shareholder in the Society, the Government has indicated that its priority, subject to all options being examined as part of the restructuring plan process, is to secure a swift sale of the Society or its integration with another entity.
I fully support the idea of a reformed and reinvigorated banking system that can serve our economy in a proper manner and within which there is scope for all credit institutions operating in the Irish market to play their full part. The Central Bank, the Financial Regulator and of course the EU Commission are also significant stakeholders in the future shape of the financial system and their views are important. I will continue to encourage all institutions to examine, separately or jointly, how they can meet their further capital or funding needs and develop business models to support economic development. I will consider all or any options presented to me and, insofar as possible and subject to EU requirements, play a positive role in supporting the delivery of viable plans consistent with competition and State aid requirements.
In my view it is better for the institutions to develop plans for the future rather than being in a centrally controlled plan. In any event, EU rules would probably not allow for the State to be directive in making arrangements between market participants. In addition, the State will not have a majority stake in some institutions and, as such, they in particular are free to develop their own long term plans subject to regulatory and shareholder approval and subject to EU and domestic rules.