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Promissory Note Negotiations

Dáil Éireann Debate, Thursday - 15 November 2012

Thursday, 15 November 2012

Questions (30)

Seán Crowe

Question:

30. Deputy Seán Crowe asked the Minister for Finance if he will provide, in tabular form, the annual interest repayments owed for the next 40 years if the maturity of all remaining promissory notes currently owed to the Irish Bank Resolution Corporation was extended out to 2052 and if annual interest on the notes was charged at 3%, 4% and 5%; and if he will make a statement on the matter. [50246/12]

View answer

Written answers

I am sure the Deputy will appreciate that financial crisis has had significant resource implications for my Department and as a result, I am not in a position to be able to provide hypothetical funding projections to Deputies. As set out in the repayment schedule below, there are significant capital and interest repayments pertaining to the existing IBRC Promissory Note. Any changes to the repayment scheduling of the capital balance will have an impact on the interest payments in the period as would any assumptions around how the funding was replaced, interest rate changes and other funding considerations. As the Deputy is aware, the Irish Government has been working extremely hard to secure a deal on the Irish bank debt and detailed work will continue to ensure that the positive moves in Europe are harnessed to maximise the benefit to the Irish taxpayer. This is on the back of the Euro Area summit statement of 29 June of this year. All options for restructuring the notes are being considered including the terms of the source of funding, the duration of the notes, the interest rate etc. The on-going work is one of the Government’s key priorities.

A significant item on the agenda in all discussions is the issue of the promissory note. I am glad to say that we meet with strong appreciation of our situation and we are able to have very constructive dialogue on our approach to this question. As discussions are on-going, it is not possible at this point to give a more detailed update or guide on the potential timing of any agreed approach but we will be continuing our engagement with the Troika and our partners in the European Union with a view to a satisfactory resolution of this issue and other related questions.

€bn

Total interest 

Paid: A

Total Capital Reduction: B

Repayments:

A + B

31/03/2011

            0.55

              2.51

            3.06

31/03/2012

               -  

              3.06

            3.06

**

31/03/2013

            0.49

              2.57

            3.06

31/03/2014

            1.84

              1.22

            3.06

31/03/2015

            1.75

              1.31

            3.06

31/03/2016

            1.65

              1.41

            3.06

31/03/2017

            1.55

              1.51

            3.06

31/03/2018

            1.44

              1.62

            3.06

31/03/2019

            1.32

              1.74

            3.06

31/03/2020

            1.19

              1.87

            3.06

31/03/2021

            1.06

              2.00

            3.06

31/03/2022

            0.91

              2.15

            3.06

31/03/2023

            0.75

              2.31

            3.06

31/03/2024

            0.57

              1.52

            2.09

31/03/2025

            0.45

              0.47

            0.91

31/03/2026

            0.39

              0.52

            0.91

31/03/2027

            0.33

              0.58

            0.91

31/03/2028

            0.26

              0.65

            0.91

31/03/2029

            0.19

              0.73

            0.91

31/03/2030

            0.10

              0.81

            0.91

31/03/2031

            0.01

              0.05

            0.05

            16.8

              30.6

            47.4

* These numbers may not tot exactly as a result of rounding

** The March 2012 repayment was settled with a long term Government bond.

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