Joan Burton (Dublin West, Labour)
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Question 213: To ask the Minister for Finance if he will provide a net figure on the difference between the overall indebtedness of the State to the banks covered by the guarantee scheme, by reason of their purchasing of Government debt, and the overall indebtedness of the covered banks to the State; and if he will make a statement on the matter. [35753/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The Central Bank of Ireland publishes data on domestic institutions (note that this includes both institutions covered by the guarantee schemes and other domestic institutions). This data states that the total securities issued by general government held by these domestic institutions totalled €9.3 billion at end August 2010. With regard to the indebtedness of credit institutions, I assume that the Deputy is referring to monies which the covered institutions will pay back to the State.

In the case of Bank of Ireland, a substantial portion of the initial €3.5bn preference share investment has been converted into ordinary equity and there are €1,837m preference shares remaining. The terms on which the preference shares were issued provide for full repayment to the Government. In the case of AIB, the Government retains its €3.5bn holding in preference shares. In my recent statement on the capital position of Allied Irish Banks, I announced that the NPRFC will underwrite a placing and open offer of €5.4bn. If necessary, the NPRFC's underwriting commitment will be satisfied by the conversion of up to €1.7bn of its existing preference shares in the bank into ordinary shares along with a new cash investment for the balance of €3.7bn in ordinary shares. This transaction structure assumes the sale of AIB's stake in M&T Bank and disposal of other assets in due course. In the event that the bank's residual capital requirement is not met through asset sales by 31 March 2011, any shortfall will be met by the conversion of a proportion of the remaining €1.8bn of preference shares.

In relation to the EBS, the Society is in discussion with a number of parties about its future and any adjustment in its capital need that arises will be accommodated in the outcome of those discussions in due course. The injections into Anglo Irish Bank and the Irish Nationwide Building Society are classified as capital transfers and as such are not a directly returnable investment.

The table below outlines the cost of assistance to each of the institutions.