Dáil Éireann Debate, Wednesday - 1 February 2012
52 Deputy Aengus Ó Snodaigh asked the Minister for Finance if he is engaging any external professional advice or services in respect of the sale of the life insurance unit of Irish Life & Permanent; the names of the companies or persons being engaged; the cost of these services; and who is covering the costs of these services. [5661/12]
Amharc ar fhreagraThe law firms Arthur Cox and Matheson Ormsby Prentice (MOP) were engaged to provide legal advice in relation to various aspects of the proposed sale of Irish Life pursuant to the terms of a framework agreement put in place following a competitive tender in March 2011, for the NTMA Banking Unit. These engagements were awarded by the NTMA in accordance with the delegation of certain banking system functions from the Minister for Finance to the NTMA in March 2010. The cost paid by the NTMA/Department of Finance to date in relation to these legal services is €188,670.13 to Arthur Cox and €44,871.67 to MOP.
As previously advised, Goldman Sachs was also engaged by the NTMA following a competitive tender in April 2011 as external advisor for the liability management exercises and capital raising transactions to be undertaken in respect of Anglo, AIB, BOI, ILP, EBS, INBS and also for advice on the sale of Irish Life. The total cost of the engagement is up to €7.8 million and will be paid by the NTMA (following consultation with the Department of Finance) although a substantial portion of the fee will be reimbursed by the financial institutions involved. It is worth bearing in mind that a large quantum of equity was generated from these LMEs (€5.6bn). Furthermore, at the time of the Bank of Ireland recapitalisation Goldman Sachs played an important role in advising the State in relation to Bank of Ireland's capital raise, including, the sale of shares to a group of North American investors. As a result of this work, the State's cash outlay for the 2011 PCAR bank recapitalisations was lower by €1.7bn than initially expected.
The delegation of banking system functions to the NTMA ended in August 2011 with the secondment of the NTMA Banking Unit to the Department of Finance Banking Division. Following the transfer, the NTMA continued to pay professional fees incurred by the Unit to 31st December 2011. From 1st January 2012, these costs will be paid by the Department of Finance.
