Government Bonds

Dáil Éireann Debate, Wednesday - 13 March 2013

Wednesday, 13 March 2013

Questions (63, 64)

Colm Keaveney

Question:

63. Deputy Colm Keaveney asked the Minister for Finance further to Parliamentary Questions No. 185 of 26 Feburary 2013 and No. 71 of 6 March 2013 if the Central Bank of Ireland can act unilaterally, or in concert with the European Central Bank, dispose of the bonds, referred to in his reply, in accordance with a schedule different to that detailed by him in his earlier replies, without the agreement of the Government; and if he will make a statement on the matter. [13420/13]

Colm Keaveney

Question:

64. Deputy Colm Keaveney asked the Minister for Finance further to Parliamentary Questions No. 185 of 26 February 2013 and No. 71 of 6 March 2013, if he has the lawful authority to direct or inhibit the disposal of the bonds, referred to in his reply, by the Central Bank of Ireland in accordance with a schedule different to that detailed by him in his earlier replies; and if he will make a statement on the matter. [13421/13]

Written answers

Minister for Finance

I propose to take Questions Nos. 63 and 64 together.

As previously advised to the Deputy, the Irish Government fully understands the need for the ECB to ensure it is operating within its mandate. As the Central Bank of Ireland outlined, the bonds will be placed in the Central Bank’s trading portfolio and will be sold, provided that conditions of financial stability permit. The disposal strategy will, of course, maintain full compliance with the Treaty prohibition on monetary financing. Decisions on disposal will be made by the Central Bank of Ireland which is statutorily independent from the Irish Government.

The Central Bank of Ireland has undertaken that a minimum of bonds will be sold in accordance with the following schedule: €0.5bn by the end of 2014, €0.5bn per annum from 2015 to 2018, €1bn per annum from 2019 to 2023 and €2bn per annum from 2024 onwards.

The Central Bank of Ireland is responsible for financial stability considerations. I would expect the Central Bank to take full account of the health of the domestic and international banking system, the global economic situation and developments in markets when considering financial stability considerations in relation to the disposal of these Irish government bonds.