Dáil Éireann Debate, Wednesday - 5 July 2017
82. Deputy Thomas P. Broughan asked the Minister for Finance the estimated level of dividends and levies from the pillar banks and other financial institutions in 2016 and 2017; the likely yields to the State from this source in 2018 and 2019; and if he will make a statement on the matter. [31679/17]
View answerThe Deputy will recall that the Finance Bill 2016 included provisions to extend the Bank Levy to 2021. I would therefore expect it to raise approximately €150 million from the sector per year over this period.
In relation to the receipt of dividends from banks in which the State is a shareholder, it is important to note that the payment of any dividend is exclusively a matter for the board and management of each institution based on the bank’s financial performance and future prospects, and may be subject to regulatory approval. Given that these are factors outside my control it is not possible to provide a formal forecast of expected income from these banking investments.
The Deputy will be aware that AIB announced a dividend payment of €250m to ordinary shareholders in April of this year, as part of their annual results for 2016, 99% of which accrued to the State as the Bank’s majority shareholder. This payment was particularly significant given that it has been nine years since the bank last paid a dividend to shareholders.
While there are still challenges facing the Irish banking sector, I would consider it normal for a profitable bank in a stable business environment to pay a prudent, regular dividend to Ordinary Shareholders where there is no impediment to do so, in keeping with a commercial strategy and financial performance objectives espoused by the bank’s management.
