Written Answers Nos. 167-179
167. Deputy Michael McGrath asked the Minister for Finance the amount of professional fees incurred by the Central Bank of Ireland in 2011, 2012 and to date in 2013; the nature of the professional services secured; the names and amounts billed by the top ten suppliers of such services; and if he will make a statement on the matter. [36675/13]
Amharc ar fhreagraI have been advised by the Central Bank of the following professional fees for 2011, 2012 and up to 17 June 2013, broken down by category. I am informed by the Central Bank that, for reasons of commercial confidentiality, the Central Bank cannot provide information on individual firms.
|
Categorised Professional Fees incurred in 2011 |
Euros |
|
Legal |
2.919m |
|
Accountancy |
2.771m |
|
Financial Services |
29.481m |
|
Other Consultancy |
777m |
|
Total |
35.948m |
|
Categorised Professional Fees incurred in 2012 |
Euros |
|
Legal |
1.729m |
|
Accountancy |
1.698m |
|
Financial Services |
14.131m |
|
Other Consultancy |
3.993m |
|
Total |
21.551m |
|
Categorised Professional Fees incurred in 2013 to 17 June |
Euros |
|
Legal |
181m |
|
Accountancy |
93m |
|
Financial Services |
1.656m |
|
Other Consultancy |
409m |
|
Total |
2.339m |
The decrease in professional fees in 2012 from 2011 is largely due to reduced expenses incurred (€12.0 million) in relation to the Prudential Capital Assessment Review and Prudential Liquidity Assessment Review of certain financial institutions in 2012. when compared with the previous year (€29.1 million). These costs were fully recouped from the relevant financial institutions.
168. Deputy Michael McGrath asked the Minister for Finance the number and total value of rent reductions approved by the National Asset Management Agency to tenants who hold leases in respect of NAMA properties; the procedure involved; and if he will make a statement on the matter. [36676/13]
Amharc ar fhreagraNAMA has engaged positively and proactively on this issue. To end-June 2013 NAMA had received 296 eligible applications from its debtors for rent abatement. 234 applications had been approved, 10 were refused and the remaining 52 are under review. The value of such rent reductions by NAMA is in excess of €14m per annum. NAMA issued a Guidance Note on Upward Only Commercial Leases on 6 December 2011 setting out the procedures by which tenants of NAMA debtors can seek rent abatement. A copy of the Guidance Note is available on NAMA’s website, www.nama.ie.
I wish to advise the Deputy that my Department is promoting the application by public bodies of NAMA guidelines on rent reviews for commercial tenants who are having difficulty paying rents which are above the market price, where the premises are owned by public bodies.
170. Deputy Michael McGrath asked the Minister for Finance the position regarding current legal action taken by Irish Bank Resolution Corporation commercial clients claiming that they were overcharged interest in respect of their commercial loans; the bank’s approach to the issue; and if he will make a statement on the matter. [36678/13]
Amharc ar fhreagraUnfortunately I am not in a position to comment directly on cases currently before the Courts. I have been advised by the Special Liquidators that in the Republic of Ireland any claims made in relation to the potential overcharging of interest would likely rank as unsecured creditors in the liquidation.
171. Deputy Michael McGrath asked the Minister for Finance based on currently available economic and fiscal projections, his Department’s estimate of the fiscal adjustment in Budget 2014 that would result in a general Government deficit of 5.1%. [36679/13]
Amharc ar fhreagraOur most recent fiscal forecasts and technical assumptions were contained in the Stability Programme Update. As the Deputy will be aware, there has been considerable data flow in the intervening period, including the recent Q1 Quarterly National Accounts, which will impact the deficit ratios in 2014. These and other relevant data, such as up to date revenue and expenditure figures, will enable our forecasts to be calculated and when this is completed will form the basis of Budget 2014.
172. Deputy Michael McGrath asked the Minister for Finance if he has had discussions with the troika on the scale of the budget adjustment in budget 2014; and if he will make a statement on the matter. [36680/13]
Amharc ar fhreagraAs the Deputy will be aware review missions to Ireland by the three external partners, the EU, the ECB and the IMF (the Troika) take place each quarter as part of the regular review process of our EU-IMF Programme of Financial Support for Ireland. My colleague, the Minister for Public Expenditure and Reform, Mr Brendan Howlin T.D., and I met with the EU-IMF delegation during the 11th Review mission which is currently taking place (9 – 18 July). These meetings were also attended by senior officials from both Departments. A wide range of topics related to the progress of the Programme are covered at these meetings, including fiscal policy, financial reforms, structural reforms, and economic developments. Budget 2014 will be discussed in this context. Budget 2014 will be announced on the 15th of October 2013 and in the preceding weeks and months, as further information is available, Government policy on Budget 2014 measures will be finalised. I will not be drawn into speculation at this time, on the composition of the next budget.
It should be noted that the most recent Programme Documents, dated June 2013, do not contain explicit requirements in relation to Budget 2014. However, the EU Council Implementing Decision on Ireland’s Programme of Financial Support, dated 7 December 2010, provides for the reduction of our General Government Deficit to below 3% in 2015 reflecting the Council’s recommendation on Ireland’s Excessive Deficit Procedure, of the same date, which sets out the path to achieve the deficit targets including 2014.
173. Deputy Michael McGrath asked the Minister for Finance if he will provide details of the dates on which he has held meetings with each CEO or chairperson of the State-supported banks since coming to office; the topic discussed at each meeting; and if he will make a statement on the matter. [36681/13]
Amharc ar fhreagraThe table outlines previous meetings that have taken place with each CEO or Chairperson of the State supported banks and I am also scheduled to meet the boards of the three banks again tomorrow, 19 July 2013. A variety of issues were discussed at these meetings and it would be inappropriate for me to detail the specifics.
Officials from my Department also meet with representatives of the various banks on a regular basis – including a monthly senior management meeting with each Covered Institution at which the CEO would usually attend.
|
Institution |
No. of meetings |
Date |
Attendees |
Chairman |
CEO |
|
PTSB |
5 |
17 May 2011 |
Previous CEO & Chairman |
Mr Alan Cook |
Mr Kevin Murphy* |
|
- |
- |
10 June 2011 |
Previous CEO & Chairman |
Mr Alan Cook |
Mr Kevin Murphy |
|
- |
- |
11 July 2012 |
CEO |
- |
Mr Jeremy Masding* |
|
- |
- |
8 Jan 2013 |
Board of the bank |
Mr Alan Cook |
Mr Jeremy Masding |
|
- |
- |
28 Feb 2013 |
Board of the bank |
- |
Mr Jeremy Masding |
|
AIB |
3 |
19 Sept 2011 |
CEO &Chairman |
Mr David Hodgkinson |
Mr David Duffy |
|
- |
- |
8 Jan 2013 |
Board of the bank |
Mr David Hodgkinson |
Mr David Duffy |
|
- |
- |
28 Feb 2013 |
Board of the Bank |
Mr David Hodgkinson |
Mr David Duffy |
|
BOI |
6 |
29 March 2011 |
CEO & Governor |
Mr Pat Molloy |
Mr Richie Boucher |
|
- |
- |
3 May 2011 |
Governor |
Mr Pat Molloy |
- |
|
- |
- |
22 March 2012 |
CEO & Governor |
Mr Pat Molloy |
Mr Richie Boucher |
|
- |
- |
5 April 2012 |
Governor Designate |
Mr Archie Kane* |
- |
|
- |
- |
8 Jan 2013 |
Board of the bank |
Mr Archie Kane |
Mr Richie Boucher |
|
- |
- |
28 Feb 2013 |
Board of the Bank |
Mr Archie Kane |
Mr Richie Boucher |
|
IBRC |
6 |
24 March 2011 |
Chairman |
Mr Alan Dukes |
- |
|
- |
- |
2 Jun 2011 |
Chairman and CEO |
Mr Alan Dukes |
Mr Mike Aynsley |
|
- |
- |
25 Jul 2012 |
Chairman and CEO |
Mr Alan Dukes |
Mr Mike Aynsley |
|
- |
- |
29 Aug 2012 |
Chairman |
Mr Alan Dukes |
- |
|
- |
- |
5 Oct 2012 |
Chairman |
Mr Alan Dukes |
- |
|
- |
- |
21 Dec 2012 |
Chairman |
Mr Alan Dukes |
- |
* Mr. Kevin Murphy is now CEO of Irish Life.
Mr. Jeremy Masding was appointed CEO of PTSB in February 2012
Mr. Archie Kane was appointed Governor of Bank of Ireland in June 2012.
The table above outlines previous meetings that have taken place between with each CEO or Chairperson of the State supported banks and I am also scheduled to meet the boards of the three banks again tomorrow 19 July 2013. A variety of issues were discussed at these meetings and it would be inappropriate for me to detail the specifics.
Officials from my Department also meet with representatives of the various banks on a regular basis – including a monthly senior management meeting with each Covered Institution at which the CEO would usually attend.
174. Deputy Michael McGrath asked the Minister for Finance for each of the State supported banks, if he will specify the way, under the split mortgage arrangement, the warehoused portion of the mortgage is treated in terms of interest; if he is satisfied with the way each bank treated the warehoused portion of the mortgage; and if he will make a statement on the matter. [36682/13]
Amharc ar fhreagraI can inform the Deputy that the State supported banks have provided me with the following information on their treatment of the warehoused portion of a split mortgage. The treatment of the warehouse portion of a split mortgage is a matter for the Central Bank.
AIB
I am informed by AIB that the warehoused portion of the split mortgage is deferred – i.e. no repayments are made for an agreed amount of time and there will be no interest charged.
Bank of Ireland
I am informed by Bank of Ireland that it provides a split mortgage option as a suitable sustainable forbearance solution for certain Borrowers under MARP. This option involves part of the mortgage being repaid on an interest-only basis at the customer’s prevailing product interest rate, with capital on this element repaid from an identified source at the end of the mortgage term.
Permanent TSB
Permanent TSB has informed me that to date it has applied a nominal rate of interest (1%) to the warehoused portion of the split mortgage. Permanent TSB informs me that it is finalising preparations to move to an interest free approach to the warehouse and expects this to be available in the coming weeks.
175. Deputy Michael McGrath asked the Minister for Finance in relation to all of the staff pension schemes that operate in the Central Bank of Ireland, the name of the scheme, if it is defined benefit or defined contribution; the current funding position of the scheme; and if he will make a statement on the matter. [36683/13]
Amharc ar fhreagraThe legal name of the Central Bank of Ireland Superannuation Scheme is the ‘Central Bank and Financial Services Authority of Ireland Superannuation Scheme 2008’. The scheme is a defined benefit funded scheme and has met the Pensions Board minimum funding standard every year since it was established in 2008. The Scheme is not Exchequer funded. Details of the Scheme are set out in the Central Bank Annual Report 2012.
176. Deputy Michael McGrath asked the Minister for Finance if his Department has been in contact with the UK Treasury about the UK Government's review of the Ulster Bank's parent company, Royal Bank of Scotland; if so, the Irish Government's position on the issue; and if he will make a statement on the matter. [36684/13]
Amharc ar fhreagraIn his Mansion House speech of 19 June 2013, the UK Chancellor of the Exchequer announced a review of Royal Bank of Scotland. The purpose of the review is to assess the merits of creating a “bad bank” for some RBS assets and it is due to conclude in the autumn of 2013. The Chancellor made some references to Ulster Bank in the context of the future orientation of RBS in dealing with the future of the two UK banks in which the British Exchequer has a significant shareholding. Last Friday, the UK Treasury announced the appointment of BlackRock Solutions as asset specialist advisor to the review. BlackRock Solutions will work alongside Rothschild and Slaughter & May, the respective corporate finance and legal advisors.
The Deputy may be aware that RBS held an Investor Roundtable on Ulster Bank in London on 2 July 2013 during which Ulster Bank set out its business strategy and the macro-economic environment for Ireland. Ulster Bank described itself as the number three player in the Republic of Ireland with 1.3m customers - 1.26 m Retail and 80,000 Corporate. It informed investors that it has a clear strategy to create a ‘Really Good Bank’ whilst tackling legacy issues; it intends to deliver a smaller, lower cost and profitable bank. Ulster Bank confirmed that it is ‘cautiously optimistic’ about the Irish market. Data published at the end of June show that, having returned to growth in 2011, Ireland achieved a second successive year of growth in 2012, with GDP expanding modestly by 0.2 per cent. Ulster Bank is correct in seeing that Ireland is a place where the banking sector can expect to achieve returns which are acceptable to investors.
The recent successful launch by BlueBay Asset Management LLP (BlueBay) and the National Pensions Reserve Fund (NPRF) of a new vehicle that will provide loans to larger SMEs and mid-sized businesses in Ireland also shows that positive sentiment has returned. The new vehicle has raised the full target amount of €450 million (including an NPRF commitment of €200 million) and has launched within the expected timescale. The very significant level of investment from third-party institutional investors is at the upper end of the range anticipated by BlueBay and the NPRF.
Normal ongoing engagement between my officials and their UK counterparts now includes the possible implications of the review for Ulster Bank and any assistance that the Treasury requires with the review will be provided as part of this engagement.
177. Deputy Michael McGrath asked the Minister for Finance the number of rent receivers appointed by each of the State supported banks to date in 2013; and if he will make a statement on the matter. [36686/13]
Amharc ar fhreagraI can inform the Deputy that under the terms of the Relationship Frameworks that govern the relationship between the Minister for Finance and the State supported banks’, the Board and Management team retain responsibility and authority for determining the banks’ strategies and commercial policies and conducting their day-to-day operations. The appointment of rent receivers to properties is a day-to-day operational decision for the Boards and Management teams of the covered institutions. The covered institutions have provided me with the following details regarding their use of rent receivers.
PTSB
- Permanent tsb has appointed 3 Receivers of Rent (Receiver) year to date in respect of Buy-to-Let (BTL) properties.
- 74 BTL properties (on 52 accounts) have been affected by this appointment year to date.
- The bank’s Receiver Strategy for its BTL portfolio is centred on a case by case analysis. Appointments are made where it is deemed to be the most appropriate outcome for both the customer and the bank. The appointment of a Receiver is currently pending on 3 BTL properties (3 accounts).
- A Receiver is appointed by the bank and operates as an agent of the borrower, assuming the role of property landlord in many respects. The Receiver collects rent from the tenant(s) and passes it to the bank, together with attending to any property related issues the tenant may have (in accordance with the Lease Agreement). The appointment of a Receiver should not negatively impact the tenant(s) as the Receiver effectively steps into the shoes of the landlord. The appointment is more likely than not to benefit a tenant as maintenance issues/concerns are more likely to be attended to in a timely manner.
AIB
In the year to date 2013, the number of rent receivers appointed by AIB in respect of buy-to-let properties is in the low single digits. The number of properties affected by these appointments is not tracked as rent receivers are appointed at a customer level rather than on a property basis.
BOI
In our 2012 Annual Report we disclosed a number of 1,100 rent receiver cases. This included formal appointments in place and appointments pending at end December 2012. We will give a market update on numbers at the time of release of our interims.
The receiver notifies the tenant of their appointment and requirement to pay rent to the receiver.
- Any issues relating to the property, e.g. repairs will be dealt with by the receiver.
- The tenant is not required to leave the property unless the minimum notice period based on their rights as tenants has been provided.
- The main impact on a tenant is that they pay their rent to the receiver and not to the landlord. The receiver will write to them to make that clear. In general the rights of the tenant under his or her lease and under legislation are not affected.
178. Deputy Michael McGrath asked the Minister for Finance if he will list and provide details of the separate investigations, under way or suspended at the Central Bank of Ireland, into various issues arising from the banking crisis which crystallised in 2008; and if he will make a statement on the matter. [36688/13]
Amharc ar fhreagraThe Central Bank has advised as follows in relation to their investigations into various issues arising from the banking crisis.
Anglo Irish Bank
In May 2011, the Gardaí informed the Central Bank, following consultation with the Director of Public Prosecutions, that to proceed with the Central Bank’s examinations at that time could prejudice any future criminal prosecutions. Accordingly, the Central Bank decided to defer its examination but will keep this decision under review. Given the seriousness and sensitivity of criminal proceedings and the strength of the sanctions available to the Gardaí and the Office of the Director of Corporate Enforcement (ODCE), this is the most appropriate approach to take where there is a reasonable possibility of multiple proceedings. Regular liaison with these agencies is continuing. In addition to the above, the Central Bank is carefully studying the various transcripts emerging recently in the national media. This is something that is viewed very seriously. The Central Bank is liaising with the Gardaí in this regard and is also examining whether or not any breaches of regulatory requirements may have occurred arising from the information contained in the transcripts.
Irish Nationwide Building Society
The Central Bank has advised that an investigation into historical lending practices at the INBS is at an advanced stage and, once concluded, decisions regarding any possible future enforcement proceedings will be made.
Quinn Insurance Limited
As noted in the Central Bank’s Annual Report for 2012, an investigation into certain matters within Quinn Insurance Limited is continuing.
For legal reasons, including the Bank’s confidentiality obligations pursuant to section 33AK of the Central Bank Act 1942, no further details can be disclosed at present.
179. Deputy Michael McGrath asked the Minister for Finance the amount of fees paid to date to KPMG arising from its work as special liquidator of Irish Bank Resolution Corporation; the estimate of the total amount of fees that will be due to the firm arising from this work; and if he will make a statement on the matter. [36689/13]
Amharc ar fhreagraAs is normal in liquidations of companies, all costs, charges and expenses properly incurred by the Special Liquidators in relation to the winding up of IBRC, including the Special Liquidators’ fees, will be paid out of the assets of IBRC in priority to all other claims. The Special Liquidators will comply with their reporting obligations and as such the liquidation accounts will be filed with the Companies Registration Office after two years of the liquidation and yearly thereafter. These accounts will detail the fees payable to KPMG arising from its work as Special Liquidators of IBRC.
