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Government Bonds

Dáil Éireann Debate, Wednesday - 6 March 2013

Wednesday, 6 March 2013

Questions (73)

Patrick Nulty

Question:

73. Deputy Patrick Nulty asked the Minister for Finance if the refinancing of Anglo Irish/ Irish Bank Resolution Corporation bonds, constitutes monetary financing. [11828/13]

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Written answers

I welcome the outcome of the ECB Governing Council meeting last month and I am not concerned that the transactions accompanying the liquidation of IBRC, involving the exchange of Promissory Notes for Government bonds, is in breach of any Articles of the Treaty on the Functioning of the European Union. The transaction was unanimously noted by the ECB Governing Council, as indicated by President Draghi on the 7th February. Furthermore on the 18th February President Draghi stated that the promissory note deal was a positive step for Ireland. The Central Bank of Ireland has carefully examined the legal and financial issues involved in the transactions and are satisfied that there is no such breach. The Irish Government fully understands the need for the ECB to ensure it is operating within its mandate. As outlined by the Central Bank of Ireland on the 7th of February, “the bonds will be placed in the Central Bank of Ireland’s trading portfolio and sold as soon as possible, provided that conditions of financial stability permit. The disposal strategy will of course maintain full compliance with the Treaty prohibition on monetary financing.”

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