Pearse Doherty (Donegal South West, Sinn Fein)
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Question 111: To ask the Minister for Finance when he intends to inject funds into Anglo Irish Bank or any of the other banks; the way in which this will affect the reserve money to fund the State in 2012; and if he will make a statement on the matter. [1405/11]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The table above sets out the amount of capital injected by the State into the Irish Banking System to date.

The Central Bank has set out the further capital that will be required by AIB, BOI and EBS in order for them to meet a 12% core tier 1 ratio by the end of February 2011 as agreed in the Programme for Financial Support with the IMF, EU and the ECB. In this regard, the position is as follows:

o In order to meet its target AIB in December 2010 received a net capital injection of €3.7 billion from the National Pension Reserve Fund. To meet its core tier 1 ratio, it will require a further €6.1 billion which the State remains committed to meeting to the extent that it cannot be met through capital raising measures by the bank itself. This is expected to be met through a combination of fresh capital from the State, the execution of a liability management exercise in relation to existing subordinated debt holders and other capital generative measures ongoing by the bank.

o The Central Bank has instructed Bank of Ireland to raise a further €2.2 billion to reach a 12% core tier 1 ratio by the end of February 2011. To date Bank of Ireland has raised some €700 million of this capital requirement through an LME exercise and intends to seek to generate the remaining required capital through a combination of internal capital management initiatives, support from existing shareholders and other capital markets sources. On 10 January 2011 Bank of Ireland announced the completion of the sale of Bank of Ireland Asset Management to State Street Global Advisors.

o EBS is now required to raise an additional €438m Core Tier 1 capital to achieve a capital ratio of at least 12% core tier 1 by 28 February 2011. The final amount of additional State support, if any, will not be known until the outcome of the sales process is finalised.

With regard to the Promissory Notes for Anglo Irish Bank, INBS and EBS, the position is:

o Anglo Irish Bank has been provided with €29.28 billion in capital, of which €25.28 billion was in the form of a Promissory Note. The terms of the Promissory Note provides that, inter alia, 10% of the initial principal amount shall be paid in March each year to the holder of the Note. In the case of Anglo, this amounts to €2.528m per annum, with the first such payment falling at the end of March 2011 from the Exchequer.

o With regard to INBS, I have injected capital amounting to €5.4 billion into the society. This comprised a €100m cash injection in return for INBS Special Investment Shares and €5.3 billion by way of a Promissory Note. The terms of the INBS Promissory Note provides that, inter alia, 10% of the initial principal amount shall be paid in March each year to the holder of the Note. In the case of INBS, this amounts to €530m per annum, with the first such payment falling at the end of March 2011 from the Exchequer.

o EBS has been provided with €875 million in capital. This comprised a €625 million cash injection in return for EBS Special Investment Shares and €250 million by way of a Promissory Note. The terms of the Promissory Note provides that, inter alia, 10% of the initial principal amount shall be paid in June each year to the holder of the Note. In the case of EBS, this amounts to €25 million per annum, with the first such payment falling at the end of June 2011 from the Exchequer.

o These annual payments under the terms of the Promissory Notes, which are provided for in the budgetary arithmetic, will be provided through cash payments from the Central Fund.