Dáil Éireann Debate, Thursday - 29 March 2012
74 Deputy Michael McGrath asked the Minister for Finance when the reduction in the interest rate being charged to Ireland from funds paid out of the EFSF and EFSM took effect; if he will provide a schedule of the current interest rates being charged to Ireland on all sources of funding under the EU IMF Programme of Assistance, including bilateral loans. [17468/12]
View answerThe Euro Area Heads of State or Government (HoSG) agreed on 21 July 2011 to reduce the cost of the European Financial Stability Facility (EFSF) to lending rates equivalent to those of the Balance of Payments facility close to, without going below, the EFSF funding cost.
In addition, further amendments to the EFSF framework have removed the interest rate margin on EFSF funds and were incorporated into a new legal agreement on the 27th of October in which the interest rate margin is now defined as zero. This reduction applies from the date of the HoSG decision i.e 21 July 2011. The agreement incorporates a guarantee commitment fee of 0.1% per annum and a service fee to cover the cost of operations of the EFSF. It should be noted that the EFSF's cost of funds depends on the interest rate it pays for its market issuance when raising funds for programme countries.
In October 2011, the EU Council of Ministers approved an EU Commission proposal to eliminate the margin of 2.925% on the EFSM facility. This change was incorporated into an amendment to the existing legal agreement on 28th October 2011 and the margin is now defined as zero. This now applies to EFSM borrowings back to the date upon which they were issued. For both the EFSF and the EFSM as for the programme loans, the actual cost of funding depends on the prevailing market rates at the time of each drawdown. The structure of the interest rates on the UK bilateral loan will change when it is incorporated into the loan agreement and will be fully retrospective.
In relation to the schedule of the current interest rate being charged to Ireland on all forms of funding under the EU/IMF Programme of financial support, the following table supplied by the NTMA, provides the information for all amounts outstanding as at 28 March 2012.
|
Drawdown Date |
Maturity Date |
Interest Rate |
Currency Code |
Currency Principal Billion |
|
01/02/2011 |
18/07/2016 |
2.750% |
EUR |
4.194 |
|
14/11/2011 |
04/02/2022 |
3.600% |
EUR |
3.000 |
|
12/01/2012 |
04/02/2015 |
1.725% |
EUR |
1.270 |
|
19/01/2012 |
19/07/2012 |
0.366% |
EUR |
0.480 |
|
15/03/2012 |
23/08/2012 |
0.291% |
EUR |
0.995 |
|
Total European Financial Stability Facility |
9.939 |
|||
|
EFSM |
||||
|
12/01/2011 |
04/12/2015 |
2.500% |
EUR |
5.000 |
|
24/03/2011 |
04/04/2018 |
3.250% |
EUR |
3.400 |
|
31/05/2011 |
04/06/2021 |
3.500% |
EUR |
3.000 |
|
29/09/2011 |
04/09/2026 |
3.000% |
EUR |
2.000 |
|
06/10/2011 |
04/10/2018 |
2.375% |
EUR |
0.500 |
|
16/01/2012 |
04/04/2042 |
3.750% |
EUR |
1.500 |
|
05/03/2012 |
04/04/2032 |
3.375% |
EUR |
3.000 |
|
Total European Financial Stabilisation Mechanism |
18.400 |
|||
|
IMF |
||||
|
18/01/2011 |
Amortising: 18 Jul 2015-18 Jan 2021 |
Floating SDR + Surcharges |
XDR |
5.012 |
|
18/05/2011 |
Amortising: 18 Nov 2015-18 May 2021 |
Floating SDR + Surcharges |
XDR |
1.410 |
|
07/09/2011 |
Amortising: 07 Mar 2016-07 Sep 2021 |
Floating SDR + Surcharges |
XDR |
1.319 |
|
16/12/2011 |
Amortising: 16 Jun 2016-16 Dec 2021 |
Floating SDR + Surcharges |
XDR |
3.309 |
|
29/02/2012 |
Amortising: 31 Aug 2016-28 Feb 2022 |
Floating SDR + Surcharges |
XDR |
2.786 |
|
Total International Monetary Fund |
13.836 |
|||
|
UK |
||||
|
14/10/2011 |
15/04/2019 |
4.72% |
GBP |
0.403 |
|
30/01/2012 |
30/07/2019 |
4.29% |
GBP |
0.403 |
|
28/03/2012 |
30/09/2019 |
4.44% |
GBP |
0.403 |
|
Total UK Bilateral Loan |
1.209 |
Notes
XDR is the currency code used to denote the IMF's Special Drawing Rights (SDRs), an international reserve asset which is composed of a basket of currencies consisting of the euro, Japanese yen, pound sterling, and U.S. dollar.
The interest rate on IMF loans is variable. It is composed of a weekly setting of the IMF SDR interest rate and surcharges which are volume and time dependent. As of 26 March 2012 the SDR interest rate accruing on Ireland's IMF loans is 0.15% and the surcharges are 2.45% making a total of 2.60%.
The interest rate for the UK bilateral facility is an annualised rate.
