Dáil Éireann Debate, Thursday - 18 December 2014
135. Deputy Michael McGrath asked the Minister for Finance the position regarding the transfer of Newbridge Credit Union to Permanent TSB; if Permanent TSB has made a claim in respect of the indemnity granted to it; if there are outstanding issues to be resolved; and if he will make a statement on the matter. [49308/14]
View answerI agreed to the Governor of the Central Bank's request for the payment of a financial incentive of up to €53.9 million to transfer the assets and liabilities - excluding the premises, of Newbridge Credit Union Limited to permanent tsb (ptsb). All assets and liabilities of Newbridge Credit Union Limited - excluding the premises - were transferred to ptsb pursuant to a High Court order dated 10 November 2013.
The financial incentives agreement between the Central Bank and ptsb, required the payment of €23 million to ptsb in cash at transfer. The financial incentives agreement also contains provisions for the Credit Institutions Resolution Fund to cover up to €4.25 million in restructuring and integration costs incurred by ptsb as part of the transaction; up to €2 million in guarantees in respect of transferring liabilities; and up to €24.7 million in Loss Compensation payments in respect of losses on the loan book.
I have been informed by the Central Bank that, to date, the Central Bank has paid €0.8 million to PTSB in respect of restructuring cost claims, and €0.3 million to PTSB in respect of transferring liabilities claims.
Separately, Jim Luby of McStay Luby was appointed as liquidator of Newbridge Credit Union Limited (in liquidation) by the High Court on 16 December 2013. The liquidation process in relation to NCU is on-going. A licence has been granted to ptsb by the liquidator to operate from the NCU premises. The liquidator has now signed contracts with the Office of Public Works to purchase NCU's former premises, with the sale expected to complete in Q1 2015.
The sale proceeds generated (net of expenses) will be paid by NCU into the Credit Institutions Resolution Fund in due course, in accordance with Section 46(6) of the Central Bank and Credit Institutions (Resolution) Act 2011. Under that Act, the Credit Institutions Resolution Fund is the principal creditor of NCU in the amount of the financial incentive paid or payable to ptsb.
