Stephen Donnelly
Question:196. Deputy Stephen S. Donnelly asked the Minister for Finance the projected payment schedule of interest charges on the Promissory Notes; and if he will make a statement on the matter. [52180/12]
View answerTuesday, 27 November 2012
Questions (196, 198)
Stephen Donnelly
Question:198. Deputy Stephen S. Donnelly asked the Minister for Finance his estimate of the total amount of the interest payments scheduled on the Promissory Note which will be returned to the State that is, the total amount forecast to be paid, less the amount of this which will be used to discharge IBRC's liabilities; and if he will make a statement on the matter. [52182/12]
View answerWritten answers
I propose to take Questions Nos. 196 and 198 together.
As the Deputy is aware, the Promissory Note repayments, both capital and interest, are made to IBRC. As IBRC is wholly owned by the State, any return to the State will be by way of dividends from IBRC or from the projected final net asset position for IBRC.
The bank previously informed me that the projected final net asset position for IBRC is considered both commercially sensitive and subject to material uncertainty given the current uncertainties in markets, the deterioration in asset values and the complexities, timescales and risks involved in deleveraging. Whilst significant progress has been made the final position will be driven by a number of variable factors against the assumptions in IBRC’s wind down plan. These factors include actual recovery rates achieved for assets, the performance of the domestic and global economies, and the prevailing interest rates in Europe over the duration of the plan.
The bank’s policy is that, due to the commercially sensitive nature of such information as noted above combined with the many external variables involved, it does not issue formal projections.
However, the Bank’s CEO has given an indication previously that the likely total cost for Anglo Irish Bank would be in the €25 - €28 billion region. The bank have informed me that since this time there have been a number of changes in market circumstance, the accelerated pace of asset disposal, and the acquisition of Irish Nationwide Building Society. While not issuing a revised projection as noted above, the bank remains of the view that there will be a small return to the State at full resolution, given the assumptions currently being used.
Further in relation to inclusion of interest in the projected ultimate outturn I have been advised that in calculating the projected final net asset position IBRC take into account interest from all assets including customers, securities and Promissory Notes.
As previously shared with the house, the projected payments on the IBRC Promissory Notes are set out below.
|
€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.