Written Answers Nos. 58-65
58. Deputy Michael McGrath asked the Minister for Finance if he will provide a breakdown of the way the Mercer report savings are being achieved for each of the Irish headquartered banks; and if he will make a statement on the matter. [54545/13]
View answerAs I stated in earlier replies to Parliamentary Questions on this matter I can confirm that the three State supported banks responded with their individual strategies, designed to achieve the required savings, by the due date of 30 April as requested by the Government in response to the Mercer Report. I was not prescriptive in how this was to be achieved respecting their differing State ownership and investment and paths to profitability. I have reviewed the letters submitted and in light of the various industrial relations developments since then I now am satisfied that the banks will deliver remuneration cost savings of 6% to 10%. The Bank of Ireland proposal focused on changes to the defined benefit pension scheme that will affect all staff who are members of this scheme and as the deputy will be aware an agreement has now been reached with the IBOA in this regard. The AIB proposal included the closure of the defined benefit scheme to future accrual along with other changes including an increase in working hours which were agreed with the IBOA in July. The PTSB proposal centred on the wind-up of the defined benefit pension scheme for all staff who were members of this scheme and this has now been completed.
For clarity senior management in the banks have made the following contributions; in the case of Bank of Ireland the proposed pension changes affect all staff in the BSPF scheme including the Chief Executive. In the case of AIB reductions in pay and benefits of higher earners ranging from 7.5% to 15% were implemented in the second half of 2012 and it also should be noted that the members of the AIB Leadership Team all joined the bank since 2008 and receive reduced pension contributions from their predecessors. In the case of PTSB all senior management joined the bank since 2008 and are on lower remuneration levels than their predecessors.
59. Deputy Michael McGrath asked the Minister for Finance his plans to put a protocol in place for the operation of rent receivers appointed to residential properties; and if he will make a statement on the matter. [54546/13]
View answerAs the Deputy is aware, the covered institutions have appointed a number of rent receivers and fixed rent receivers. I have informed the Deputy recently that under the Relationship Frameworks that govern the relationship between the Minister for Finance and the State supported banks’, the bank’s Board and Management team retain responsibility and authority for determining the banks’ strategies and commercial policies and conducting their day-to-day operations. The appointment of rent receivers to properties is a day-to-day operational decision for the Boards and Management teams of the covered institutions. I have been advised by the Central Bank of Ireland that it has no plans to put a protocol in place for the operation of rent receivers at this time.
The Deputy may wish to note that the Residential Tenancies Act 2004, which falls within the responsibility of the Department of the Environment, Community and Local Government, provides the main regulatory framework for the private rented residential sector and for the operation of the Private Residential Tenancies Board. The Act provides for security of tenure and specifies minimum obligations for landlords and tenants under a tenancy. In addition, the Act contains provisions relating to the setting of rent and rent reviews and sets out the procedures and notice periods that must be complied with when terminating a tenancy.
In circumstances where a receiver is appointed in respect of a rented dwelling, it is important that the rights of tenants under both tenancy agreements and the Residential Tenancies Act are protected. While the circumstances of each case may vary depending on how a receiver is appointed, the statutory or contractual rights of tenants should not be compromised.
My colleague, the Minister of State for Housing and Planning, Minister Jan O'Sullivan T.D., has informed me that arising out of her concerns on this issue, she met with the Irish Banking Federation in relation to the provision of guidance in regard to receivers and their responsibilities towards tenants. As a result of that meeting the IBF has published a guide to receivership for residential tenants.
I am also informed by Minister O'Sullivan that she is also examining whether amendments to the Residential Tenancies Act, in the context of the Residential Tenancies (Amendment) (No. 2) Bill 2012, could help to bring greater clarity in this area that would be of benefit to tenants and indeed to receivers in how they fulfil their functions. The Bill was passed by the Dáil and is currently before the Seanad.
60. Deputy Michael McGrath asked the Minister for Finance if his Department has had any contact with the Irish headquartered banks on the issue of confidentiality agreements that certain bank customers are required to sign before they will receive a deal on their mortgage arrears issues; and if he will make a statement on the matter. [54547/13]
View answerI have been informed by AIB that customers may be required to sign a confidentiality agreement as part of AIB’s normal commercial activities. AIB has stated that its correspondence/interactions with customers are confidential and all customers are encouraged in advance of signing any new documentation to get their own independent advice prior to signing. However AIB informs me that it does not currently request sole mortgage arrears customers, i.e. those that do not have other commercial or investment debt, to sign confidentiality agreements. Bank of Ireland has informed me that in certain cases it will require a customer to sign a confidentiality agreement prior to entering into discussions in relation to the formulation of an alternative arrangement/restructuring. Bank of Ireland has informed me that the reason for this is that it treats customers on an individual case by case basis and, especially in cases of particular sensitivity, it wishes to ensure that the subject matter of the arrangement is confidential between the bank and the customer.
Permanent TSB has informed me that it is not standard or usual for it to request its customers to sign non-disclosure agreements in respect of restructurings. Permanent TSB informs me that requests for same are rare and made only on an exceptional basis.
61. Deputy Michael McGrath asked the Minister for Finance if he will provide details of the current value, including a breakdown by asset type, of the National Pensions Reserve Fund; and the amount of the remaining value of the fund has been committed to for various purposes. [54548/13]
View answerThe National Pensions Reserve Fund was valued at €15.6 billion at 30 September 2013. The directed portfolio (public policy investments in Allied Irish Banks and Bank of Ireland made at the direction of the Minister for Finance) was valued at €9.0 billion and the discretionary portfolio (the investment of which remains the responsibility of the NPRF Commission) was valued at €6.6 billion. The balance of the directed portfolio at 30 September 2013 included the Preference Shareholding in Bank of Ireland which as recently announced has been disposed of. I have given instructions that the proceeds arising from the Bank of Ireland preference shares transaction should remain with the NPRF for the time being.
The asset allocation of the discretionary portfolio at 30 September 2013 is set out in the following table:
|
Asset Class |
€ m |
% of Discretionary Portfolio |
|
Large cap equity |
1,245 |
19.0 |
|
Small cap equity |
247 |
3.8 |
|
Emerging markets equity |
475 |
7.2 |
|
Quoted Equity |
1,967 |
30.0 |
|
Eurozone government bonds |
160 |
2.4 |
|
Eurozone inflation linked bonds |
121 |
1.8 |
|
Eurozone corporate bonds |
389 |
5.9 |
|
Cash |
1,803 |
27.5 |
|
Financial Assets |
2,473 |
37.7 |
|
Private Equity |
716 |
10.9 |
|
Property |
402 |
6.1 |
|
Commodities |
305 |
4.7 |
|
Infrastructure |
434 |
6.6 |
|
Absolute return funds |
248 |
3.8 |
|
Alternative Assets |
2,105 |
32.1 |
|
Value of Equity Options |
8 |
0.1 |
|
Total Discretionary Portfolio |
6,553 |
100 |
As recently announced, the Government has decided to reorient the NPRF into the Ireland Strategic Investment Fund , which will allow the resources of the NPRF to be deployed towards productive investment in the Irish economy.
In the light of this reorientation and the intention to maximise the impact of ISIF investments by attracting private sector co-investment, the NPRF Commission has made a number of commitments to investments in Ireland, including a substantial number of co-investments, while remaining within the twenty per cent limit on Irish exposure which the Commission has determined to be the appropriate level of exposure to investment in this country given the Fund’s current investment mandate under the NPRF legislation. A detailed table of these NPRF commitments to investment in Ireland as at 30 September 2013 is set out in the following table:
|
Investment |
NPRF Commitment Capital (€m) |
3rd Party Capital (€m) |
Total project size |
Multiple of NPRF Commitment |
|
Innovation Fund Ireland |
125 |
125 |
250 |
2x |
|
Local Venture Capital Funds |
69 |
320 |
389 |
5.5x |
|
Irish Corporate Bonds |
79 |
- |
79 |
1.0x |
|
Irish Forestry |
36 |
187 |
223 |
6.2x |
|
Irish Infrastructure Fund |
250 |
66 |
316 |
1.3x |
|
SME Equity Fund – Better Capital |
125 |
30 |
155 |
1.2x |
|
SME Equity Fund – Cardinal Carlyle |
50 |
50 |
100 |
2.0x |
|
SME Credit Fund – BlueBay |
198 |
252 |
450 |
2.3x |
|
Irish Water |
250 |
- |
250 |
1.0x |
|
Total Committed |
1,182 |
1,030 |
2,212 |
|
|
Expected future commitments of NPRF |
81 |
368 |
449 |
5.5x |
|
Total Commitments |
1,263 |
1,398 |
2,661 |
2.1x |
In addition to the above table the National Pensions Reserve Fund has provided a stand-by credit facility for the N11 and Schools Bundles 3 Public-Private Partnership projects.
62. Deputy Michael McGrath asked the Minister for Finance the number of completed transactions under the National Asset Management Agency's deferred purchase scheme; and if he will make a statement on the matter. [54549/13]
View answerI am advised by NAMA that its debtors and receivers have, to date, sold a combined 204 houses, with a value in excess of €40m, under the 80/20 Deferred Payment Initiative. This Initiative was introduced by NAMA in May 2012 in response to concerns amongst certain categories of buyers, at that time, about possible future declines in housing values.
63. Deputy Michael McGrath asked the Minister for Finance if there is presently any legislation on the Statute Book which provides for the offence of reckless management of a financial institution; and if he will make a statement on the matter. [54550/13]
View answerI wish to advise the Deputy that there is no specific 'offence of reckless management' on the statute books. However, the Deputy will be aware that An Garda Síochána, the Office of the Director of Corporate Enforcement and the Central Bank have carried out investigations into the actions of certain officials who were employed in the financial services industry. It would not be appropriate for me to comment further on any such investigations or the outcomes of same.
64. Deputy Michael McGrath asked the Minister for Finance the number of persons employed by the National Treasury Management Agency, including the National Asset Management Agency, who currently have a basic salary in excess of €100,000; the number with a salary in excess of €150,000; the number with a salary in excess of €200,000 and the number with a salary in excess of €250,000. [54551/13]
View answerThe following table, which is included in the National Treasury Management Agency Annual Reports and Accounts for the year ended 31 December 2012, sets out the salaries paid by the agency by salary band.
NTMA Salaries by Salary Band at End 2012
|
- |
NTMA (excluding NAMA) |
NAMA |
Total |
|
Up to €50,000 |
92 |
25 |
117 |
|
€50,001 to €75,000 |
71 |
49 |
120 |
|
€75,001 to €100,000 |
52 |
58 |
110 |
|
€100,001 to €125,000 |
21 |
39 |
60 |
|
€125,001 to €150,000 |
14 |
31 |
45 |
|
€150,001 to €175,000 |
11 |
9 |
20 |
|
€175,001 to €200,000 |
4 |
9 |
13 |
|
€200,001 to €225,000 |
2 |
0 |
2 |
|
€225,001 to €250,000 |
1 |
1 |
2 |
|
€250,001 to €275,000 |
3 |
1 |
4 |
|
€275,001 to €300,000 |
2 |
0 |
2 |
|
€300,001 to €325,000 |
0 |
0 |
0 |
|
€325,001 to €350,000 |
2 |
0 |
2 |
|
€350,001 to €375,000 |
0 |
2 |
2 |
|
€375,001 to €400,000 |
0 |
0 |
0 |
|
€400,001 to €425,000 |
1 |
0 |
1 |
|
€425,001 to €450,000 |
0 |
0 |
0 |
|
Total |
276 |
224 |
500 |
Notes:
1. The public service pension deduction is applied to NTMA employees.
2. In December 2011 the Minister for Finance requested NTMA employees whose salaries exceeded €200,000 to waive 15 per cent of salary or such amount of salary as exceeds €200,000 if application of the full 15% reduction would bring their salary to below €200,000. Reductions in respect of employees waiving such amounts are reflected in the above table.
65. Deputy Michael McGrath asked the Minister for Finance the average length of time it is taking the Financial Services Ombudsman to deal with new complaints submitted to the body by personal customers of financial services. [54552/13]
View answerFirstly, I must point out that the Financial Services Ombudsman is independent in the performance of his statutory functions. It would not be appropriate for me to comment on how he performs his duties. I have been advised by the Financial Services Ombudsman that in respect of the work undertaken by him during the period 1 January 2013 to 13 December 2013 the average period from the initial submission to commencement of formal investigation was in the order of 3 - 4 months.
On the issue more generally the average period from the commencement of formal investigation to conclusion of formal findings was in the range of 3 - 10 months, depending upon the complexities of the issues which arose. Every complaint to the Financial Services Ombudsman is dealt with on its own individual merits and consequently the timeframe can vary considerably in accordance with the nature of the particular issues which arise. In the course of investigation, the parties to a complaint are asked to adduce all appropriate evidence and are given every opportunity to make all submissions required in relation to the pertinent issues.
