Mr. Barry O'Leary:

I will deal with Deputy Ellis's questions. We have concerns in terms of our lending directly to voluntary bodies. Our primary concern is to ensure we safeguard the assets of the State, which is our job. We have put in place a rigorous assessment of them. The results to date show that of the 17 groups that applied, we have approved only four, rejected eight and five are still pending and under negotiations. The level of success at this stage is quite small because we are particularly anxious to ensure that they have a structure in place both in terms of financial and governance structures to make sure they are capable of managing these projects. That is particularly important to us.

He also asked why our profits jumped from €3.6 million to €15 million. This arose from movements in the international financial markets. Our cost of borrowing has fallen by approximately 1.25% in the past 12 months and as a consequence we will make €12 million. As things settle down in the financial markets we will return to normal profitability, which is somewhere between zero and €3 million or thereabouts.

On the question of loans for water projects and so on, the proportion of those loans that we have on our book is quite small, there is less than €100 million involved. Therefore these are relatively small projects and we have borrowed through two European banks, the European Investment Bank and the Council of Europe Development Bank. In all cases all the money is paid back on time and in full. As an agency, we are probably the only financial institution in the country which has no loan arrears. We have absolutely no loan arrears on our book because we do business with local authorities.