IBRC Liquidation

Dáil Éireann Debate, Tuesday - 19 February 2013

Tuesday, 19 February 2013

Ceisteanna (257)

Gerry Adams

Ceist:

257. Deputy Gerry Adams asked the Minister for Finance if he will detail the total amount of ELA debt that was provided to Irish Bank Resolution Corporation as consideration for the Facility Deed with IBRC before its liquidation; if he will confirm that the Anglo Irish Bank Annual Report and Accounts 2010 description of the Facility Deed with the Central Bank of Ireland as an unsecured loan facility guaranteed by him, who separately benefits from a counter indemnity from the bank should the guarantee be called upon is the correct description of this arrangement between the bank and the Central Bank of Ireland up until the liquidation of IBRC; if he will confirm that this Ministerial Guarantee and counter indemnity to honour this guarantee has now been called upon as a result of the IBRC liquidation and NAMA enforcing its security; if he will confirm that the counter indemnity from IBRC to him for the now repayment of National Assets Management Agency bonds issued as consideration for the Facility Deed ELA associated debt is indemnified against all of the assets on IBRC’s balance sheet except those assets which were secured as collateral against the Master Loan Repurchase Agreement and the Special Master Loan Repurchase Agreement between the Central Bank of Ireland and IBRC; and if he will make a statement on the matter. [8286/13]

Freagraí scríofa

Minister for Finance

At the time of the IBRC liquidation the funding agreements in place between IBRC and the Central Bank of Ireland with respect to ELA consisted of the Special Master Loan Repurchase Agreement and the Facility Deed. The amount of funding advanced to IBRC at the time of liquidation was c.€40 billion. There was no funding advanced to IBRC under the Master Loan Repurchase Agreement when IBRC was put into liquidation. The description in the 2010 Annual Report with respect to the Facility Deed was correct for the funding arrangements in place at the time. However, a floating charge was granted to the Central Bank of Ireland by IBRC over unencumbered assets in October 2012 and the Facility Deed benefits from this floating charge. Previously, part of the ELA outstanding was secured by loan assets under an MLRA. At the time of the appointment of a Special Liquidator to IBRC, the MLRA collateral had been replaced by lending against the Facility Deed and a floating charge over all of the assets on IBRC’s balance sheet.

Following liquidation, the Central Bank will exchange the obligation owing to it under the Facility Deed and the assets on IBRC’s balance sheet under a floating charge, which includes assets previously collateralised under the MLRA, for NAMA bonds which are guaranteed by the Irish Government.

The Ministerial Guarantee has not been called upon with respect to ELA. The Ministerial Guarantee will transfer to NAMA on its acquisition of the Facility Deed from the Central Bank of Ireland.