Cathy Bennett (Cavan-Monaghan, Sinn Fein)
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100. To ask the Minister for Finance if any analysis has been carried to assess the level of dividend forgone as a result of the State selling AIB, for each of the years 2022, 2023 and 2024. [39381/25]

Mattie McGrath (Tipperary South, Independent)
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Question No. 100 is in the name of Deputy Cathy Bennett but, with the permission of the House, will be taken by Deputy Pearse Doherty.

Pearse Doherty (Donegal, Sinn Fein)
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What analysis, if any, has been carried out by the Minister or his Department in relation to the dividends forgone as a result of the State selling its shares in the AIB since 2022? As the Minister knows, I argued against the sale of those shareholdings in which at one point in time we had 71% of the shares. What dividend are we losing as a result of the fact that we now do not hold shares that bank?

Paschal Donohoe (Dublin Central, Fine Gael)
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The long-standing policy of this Government is to return the remaining banks to private ownership while achieving value for the taxpayer. It continues to be the Government's belief that banking in the main is an activity that should be provided by the private sector and that taxpayer funds which were used to rescue the banks should be recovered and used for more productive purposes. The distribution of capital is the responsibility of the board and management of the bank.

To assess this hypothetical scenario, I would need to speculate on both the level of dividends and indeed the mix of capital distribution via cash dividends or buybacks that the bank might have declared in a scenario where the State did not reduce its shareholding between 2022 and 2024. The factual position is that AIB paid ordinary dividends of €166 million, then €696 million and then €861 million in respect of the fiscal years 2022 to 2024. The total yield to the State from those dividends was €463 million.

In conjunction with the payment of ordinary dividends, AIB completed directed share buyback programmes from the State. The total yield to the State from these directed buybacks was €2.9 billion. Regarding the 2024 figure, a €500 million directed buyback was completed during the following half-year results and a further €1.2 billion following the full-year results.

To reiterate, I cannot speculate on what the board of AIB would have done as regards capital distributions over the period to which the Deputy refers, as the State's shareholding would have remained unchanged.

Pearse Doherty (Donegal, Sinn Fein)
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There is no doubt that we will not benefit from hundreds of millions of euro in dividends each year. The Minister can make the point of €273 million of a dividend last year on the basis of a 19% shareholding. Obviously, if we had the 71% that would be significantly increased in a year where the bank paid out close to a billion euro on dividends. This was one of the most financially reckless decisions that have been made in a long time. In 2022, when the public owned more than 70% of AIB, the share price was €2.32. That is when the State started selling at a more aggressive pace. The share price now is about €7. A bit of simple maths would show that, even if we held the shares today and sold them all today, which I would not agree with, but if the State sold them all today it would have made about €4.5 billion more. Through the aggressive selling of the shares of AIB, does the Minister not accept the fact that he probably lost the State more than €4 billion in the value of the shares?

Paschal Donohoe (Dublin Central, Fine Gael)
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Well, look, the Deputy referred to simple maths. I would refer to a simple understanding of stock markets. I know Deputy Doherty is a little hazy and unclear on the issue of how companies are owned. In regard to AIB, if we were in a position where the financial markets were expecting that the State was not going to reduce its shareholding in AIB over time, of course that would materially affect the value of the shares. The Deputy cannot simply say - he knows this - that if we were still the majority shareholder in AIB, we would be able to sell the shares at a different price. The fact that we were willing to sell the shares in the first place influenced what the price would have been when they were sold. I fundamentally do not accept the argument Deputy Doherty is making. He knows the money we have gained back from the share transactions that have been made. I am at a loss as to why we would want to retain a deep ownership between ourselves and our banking system, given all the difficulties that caused in the past.

Pearse Doherty (Donegal, Sinn Fein)
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It is not just the Minister who is at a loss. The taxpayer is at a loss because of his decision. The reality is, and I asked whether his Department did any analysis of this, one of the major issues in terms of share price is the profitability of a bank or of a company.

We can see the profitability of AIB and Bank of Ireland. The bank was nationalised at a time when it was making losses and was sold privately at a time when it was making significant profits. The two banks between them made €4 billion in profit last year. We know all the reasons for that in terms of ECB interest rates and not passing that on to customers.

There is, however, a simple point. It may be one that the Minister does not want to deal with. The reality is that the share price when the Government sold its holding was just over €2. It is now €7. Does the ownership structure of the entity have an impact? Of course it does. However, I ask him not to pretend that is the reason the share value has gone from €2 to €7. There is an issue here in respect of profitability. The point is that we are at a loss as a result of hundreds of millions of euro in dividends each year. There was always an ability for us to sell but it was sold at the wrong time.

Paschal Donohoe (Dublin Central, Fine Gael)
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The Deputy is completely wrong. He said he would have been happy for us to keep shares in our banks when he is aware of the long-term risk of the relationship between the financial health of the State and our banking system becoming too close. He understands that as well as I do. Why would we want the financial health of our country to be some way influenced all over again by the movement upwards and downwards of a share price within our banking system? We got good value for the taxpayer in relation to all of this.

Pearse Doherty (Donegal, Sinn Fein)
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We did not. Is the Minister joking me?

Mattie McGrath (Tipperary South, Independent)
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The Minister has the floor.

Paschal Donohoe (Dublin Central, Fine Gael)
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The total transaction-----

Pearse Doherty (Donegal, Sinn Fein)
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Anglo Irish Bank cost €33 billion.

Mattie McGrath (Tipperary South, Independent)
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Deputy Doherty-----

Paschal Donohoe (Dublin Central, Fine Gael)
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There we go.

Pearse Doherty (Donegal, Sinn Fein)
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Come on.

Mattie McGrath (Tipperary South, Independent)
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The Minister has the floor.

Paschal Donohoe (Dublin Central, Fine Gael)
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There we go. When did I make reference to Anglo Irish Bank?

Pearse Doherty (Donegal, Sinn Fein)
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The Minister said we got good value out of all of this.

Mattie McGrath (Tipperary South, Independent)
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Speak through the Chair, please.

Paschal Donohoe (Dublin Central, Fine Gael)
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This has become a very familiar tactic of Deputy Doherty's over many years. He asked me a question about AIB and Bank of Ireland-----

Pearse Doherty (Donegal, Sinn Fein)
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Tell us how we got good value then.

Paschal Donohoe (Dublin Central, Fine Gael)
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-----and I answered the question about AIB and Bank of Ireland. The Deputy then plucked the huge loss of taxpayers' money in relation to Anglo Irish Bank, which this question is not about.

Mattie McGrath (Tipperary South, Independent)
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Tá an t-am caite. Thank you, Minister.

Pearse Doherty (Donegal, Sinn Fein)
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We also lost as a result of AIB.

Paschal Donohoe (Dublin Central, Fine Gael)
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What the Deputy is doing-----

Mattie McGrath (Tipperary South, Independent)
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Please, Minister, you are way over time.

Paschal Donohoe (Dublin Central, Fine Gael)
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-----is putting forward an argument that does not make sense.

Pearse Doherty (Donegal, Sinn Fein)
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Let me make the argument in respect of AIB.

Mattie McGrath (Tipperary South, Independent)
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Resume your seat, please, Deputy.

Paschal Donohoe (Dublin Central, Fine Gael)
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The Deputy tends to be quite hazy on the issue-----

Pearse Doherty (Donegal, Sinn Fein)
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The Minister likes to ignore the fact that we paid-----

Paschal Donohoe (Dublin Central, Fine Gael)
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-----of how companies are owned.

Mattie McGrath (Tipperary South, Independent)
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Minister, please, you are half a minute over time.

Paschal Donohoe (Dublin Central, Fine Gael)
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I know that and he knows that. I have answered the question.

Pearse Doherty (Donegal, Sinn Fein)
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The Minister likes to ignore the €700 million in interest every year that the Comptroller and Auditor General has talked about.

Mattie McGrath (Tipperary South, Independent)
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Ciúnas, please.

Pearse Doherty (Donegal, Sinn Fein)
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That is not good value.