Tuesday, 27 May 2014

Questions (105)

Joan Collins

Question:

105. Deputy Joan Collins asked the Minister for Finance further to Parliamentary Question No. 106 of 30 April 2014 and a previous statement by the Governor of the Central Bank of Ireland that it is only in the matter of setting interest rates that his national loyalties are subordinated to the supranational good of the eurozone, if he will confirm that the Governor will not accelerate the disposal of the €25 billion of sovereign bonds used to swap with the Irish Bank Resolution Corporation promissory notes in February 2013, and if such accelerated disposals place an additional net cost on the State. [22481/14]

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Written answers (Question to Finance)

The Central Bank of Ireland is independent in the exercise of its functions and the management of its investment holdings are a matter for the Bank itself.  Therefore, I am not in a position to confirm what actions the Governor of the Central Bank of Ireland may or may not take. Subsequent to the liquidation of IBRC, the Bank acquired €25bn of Floating Rate Notes (FRNs) and €3.46bn of Government Fixed Coupon 2025 bonds.  The Central Bank's Annual Report for 2013 indicates that it intends to sell the combined portfolio of the FRNs and the fixed rate bond as soon as possible, provided conditions of financial stability permit. The Bank also indicates that, as a minimum, it will sell securities in accordance with the following schedule: to end 2014 (€0.5 billion), 2015-2018 (€0.5 billion per annum), 2019-2023 (€1 billion per annum), and 2024 on (€2 billion per annum until all bonds are sold). The Report also notes that, as part of this strategy, the Bank sold €350mn of its holdings of the Government 2025 Fixed Rate Bond in 2013.